Students concerned about interest rates
By Sean Barron
Cary Dabney is looking forward to entering graduate school at Youngstown State University, but dampening his enthusiasm is worry related to the financial aspect.
“This will create a hole we can never get out of,” Dabney said, referring to the prospect of thousands of students having to pay significantly more for college loans.
Dabney was one of several YSU students who offered testimony during a press conference Monday in YSU’s Kilcawley Center calling for the passage of the Stop the Student Loan Interest Rate Hike Act of 2012, co-sponsored by U.S. Sen. Sherrod Brown, D-Avon, who also spoke at the gathering.
The legislation would block the 3.4 percent interest rate on federally subsidized Stafford loans from doubling to 6.8 percent by July 1, Brown explained.
The increase, however, would not apply to loans now in repayment or that already have been disbursed, but would affect students still in school after July 1 who need to take out new Stafford loans.
“Unless Congress acts, in less than three weeks approximately 10,000 students in the Mahoning Valley will be forced to pay more for their Stafford loans,” Brown said. “Already, recent college graduates are struggling to find work, with half of young college graduates jobless or underemployed.”
The 35-year-old Dabney, a senior who moved to Youngstown from the Flint, Mich., area in 2009 to attend graduate school, said he’s also deeply concerned for the oldest of his six children, a daughter who plans to attend YSU and will have to rely on student loans to pay for her education.
Such a situation will lead to “an insurmountable debt cycle,” that will make it much harder to put away money for his other children’s college education and will see him paying off loans after he retires, Dabney continued.
“I’m not asking for loan forgiveness, just loan sensibility,” Dabney said, a philosophy and religious-studies major.
Also worried about spiraling debt is Laura Krcelic of New Middletown, who’s majoring in middle-school science and math education.
Doubling the rate “would punish us for doing what we were supposed to do,” she said, referring to the decision pursue higher education.
Krcelic noted that her parents have large medical bills and are unable to help with her college expenses and that she has about two more years at YSU.
The number of YSU students who need such loans increased about 10 percent since 2008, noted Elaine Ruse, director of the university’s Office of Financial Aid and Scholarships.
Cory Okular, an economics and political-science major and president of YSU’s student government, explained that the Stafford loans make college more affordable, and that money saved by maintaining the current interest rate can boost the local economy.
Echoing that theme, Brown said that freezing the rate would make it easier for more people to start businesses and families as well as buy homes and cars, thereby stimulating the Valley’s economy.