By Leada Gore
A new bill is taking aim at interest rates paid by student loan borrowers.
Sen. Peter Welch, D-Vermont, and Rep. Joe Courtney, D-Connecticut, introduced the Student Loan Elimination Act that would cut interest rates to 0% for all 43 million student loan holders in the U.S. Future borrowers would pay interest on their loans but the amounts would be capped at no higher than 4%.
“Students and families are already saddling the rising costs of a college education. The federal government should not exacerbate the problem by making money off borrowers’ federal student loans,” Courtney said, pointing out the average public university student who takes out a federal loan will pay $7,800 in interest over a 10-year period.
“That’s the difference between making mortgage or car payments, affording medical care, or saving for a stronger retirement,” Courtney added.
Student loan payments are set to restart in September after a three-year pause put in place at the start of the COVID pandemic. The bill also comes after the Supreme Court struck down President Biden’s widescale student loan forgiveness plan that would have dismissed up to $20,000 in debt for federal loan holders.
