Queens College students, like students across New York, face thousands of dollars in debt upon graduation. Photo courtesy CUNY
The average student at Queens College will graduate with more than $20,000 in debt, reports showed, and lawmakers are honing in on ways to make learning not require lifelong payments.
U.S. Sen. Charles Schumer (D-NY) pushed legislation last week that would allow outstanding student loan debt to be refinanced at lower interest rates not being offered to new borrowers. He stood beside a crowd of young students just beginning their college careers and said now was the time to act before their student loans took a stranglehold on their futures.
“High interest rates on student loans are creating an anchor around the necks of our young professionals throughout New York City and the state as they enter the workforce,” Schumer said. “I am pushing a plan that will aid those individuals drowning in debt.”
Roughly 912,000 students borrowed money for college in New York City in 2012, according to the Federal Reserve Bank of New York, and Schumer said they were the key demographic for his “Fair Shot” legislation to stifle interest rates before they stifle the students. The lawmaker said the plan was the next logical step after he celebrated another piece of legislation that made undergraduate loans for the 2013-2014 locked in a 3.86 percent interest.
The Project on Student Debt released a report outlining how severe student loan debt as become throughout the country and found that seven out of 10 college seniors graduating last year were close to $30,000 in debt on average.
That report found that 2012 grads at Queens College left the school with about $20,624 in debt on average. St. John’s University grads were much higher, with an average student leaving with about $29,199 in debt, the report said.
“At Queens College, we feel we offer extremely competitive tuition and value for the money,” said Maria Matteo, a spokeswoman for Queens College. “That said, we also provide several different loan opportunities for students to ensure they can make ends meet.”
The Consumer Financial Protection Bureau studied how student loan debt could impact the country’s housing market between 2007 and 2011 and found the number of Americans between 25 and 34 living with their parents increased from 4.7 million to 6 million. Only nine percent of 29 to 34-year-olds bought their first home from 2009-2011, compared to 17 percent 10 years prior, the Center for American Progress reported.
Schumer said his legislation would allow all eligible federal and direct student loan borrowers and eligible private borrowers to refinance their high-interest loans down to rates offered to the new federal borrowers in the 2013-2014 school year under the Bipartisan Student Loan Certainty Act. It was the necessary next step, he said, to keep rates from soaring up above 14 percent in the current market.
“This new legislation will allow New York City’s over 900,000 annual student loan borrowers, with interest rates up to 14 percent, to refinance their debt at the lower rates of today, so that they can look to the future and eventually save for a car, a home or even retirement,” Schumer said. “All Americans deserve access to a good education – it’s truly a necessity – but with skyrocketing student loan debt, plus exorbitant interest rates on top of that, college grads are struggling to make ends meet.”
By Phil Corso
