Warren: Student-Loan Rate Should Be Same as Banks

Stan Honda, AFP/Getty ImagesMassachusetts Sen. Elizabeth Warren.
BOSTON -- U.S. Sen. Elizabeth Warren is calling on Congress to stop student loan interest rates from doubling this summer.

The Massachusetts Democrat introduced a bill Tuesday which would let students pay the same interest rate on their government loans as banks.

Student loan interest rates are set to jump from 3.4 to 6.8 percent in July. Warren said banks can borrow from the Federal Reserve at an interest rate of less than 1 percent.

In a speech on the Senate floor, Warren said supporting college graduates is critical to a strong economy and is as much of a priority as providing banks with cheap access to credit.

Warren said her bill would let students borrow funds at the same rate as banks borrow from the Federal Reserve for one year.


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mrjdonnelly

I would like the gov to tell my bank to give me a car loan at the discounted rate - "critical to a strong economy."
Maybe Warren should just tell schools to lower their prices.

May 14 2013 at 8:14 AM Report abuse -2 rate up rate down Reply
wgbittner

you could offer no interest rates and they would still not pay off their loans. they think the taxpayers owe them something. what about the students that chose not to go to college and run up their debts.

May 10 2013 at 4:35 PM Report abuse -2 rate up rate down Reply
skylinegra

About a third of college students just go to do drugs and screw off and never graduate. The rate should be 10% and cut out the one's who have no business being there

May 10 2013 at 12:51 PM Report abuse -2 rate up rate down Reply
Gumby

Ben, one of the reasons investors are reaching for yield is that they owes so much to creidt card agencies at much higher interest rates. One way to solve is to require that consumers put up more cash in purchases as down payments. Suppose you want a $500 HDTV and your credit card can lend you $400. You have to put up $100 cash upfront. That way, it should eliminate most of the repossessions because consumers remember that they put up cash and will take better care of their purchases by keep up with regular payments . The interest rates will come down.

May 10 2013 at 10:12 AM Report abuse rate up rate down Reply
cpo1514

Govt should sell the loans to the banks. The Govt has NO BUSINESS in the student loan business. Whats next car loans????

May 10 2013 at 9:58 AM Report abuse -1 rate up rate down Reply
stengernc

Republicans have created the biggest recession in the history of America and now they claim that students are not paying their loans off. If you look at the job market, a large number of students can't find jobs that pay above minimum wage while the super rich who control the Republican party now own 50% of all the wealth in America. This cancer of greed is destroying this country so thank a Republican for the sickness.

May 10 2013 at 6:08 AM Report abuse +2 rate up rate down Reply
1 reply to stengernc's comment
rich_paddlyrich

Bush Policies Drive Surge in Corporate Tax Freeloading
82 Big U.S. Corporations Paid No Tax in One or More Bush Years
Eighty-two of America’s largest and most profitable corporations paid no federal income tax
in at least one year during the first three years of the George W. Bush administration — a
period when federal corporate tax collections fell to their lowest sustained level in six
decades. This is one of the many troubling findings of a major new report on corporate tax
avoidance by Citizens for Tax Justice (CTJ) and the Institute on Taxation and Economic
Policy (ITEP). The report covered 275 profitable Fortune 500 corporations, with total U.S.
profits of $1.1 trillion over the three-year period.

May 10 2013 at 8:04 AM Report abuse +4 rate up rate down Reply
albatroll

I want my business loan rate lowered! I work pay taxes and pay high interest rates on business loan. Did you know banks classify small business loans as high risk and charge a higher interest rate no matter how good your credit is? Why should I pay more in taxes so someone else can have a lower interest rate? It is time for the government to get out of every little problem that people create for themselves. Time the lazy pampered college kids went to work and paid their debts!

May 10 2013 at 5:43 AM Report abuse rate up rate down Reply
Art

Wow alot of misinformed or uninformed posters here. This isn't about Liberal's or Conservatives. This is about doing whats right. This affects people from both political ideologies. An educated workforce is good for this Country. Bankers can get loans for less than 1%, so too should students...It's an investment in our future. Everything should not be just about profit.

May 10 2013 at 1:45 AM Report abuse +1 rate up rate down Reply
1 reply to Art's comment
cpo1514

Art... these posters are just uninformed Libs walking like 'ducks in a row' . A lib is uneducated being led by the uninformed... right Moochelle???

May 10 2013 at 10:00 AM Report abuse rate up rate down Reply
aevf101

It's not the interest rate that's the problem. The reason there is a "student loan crisis" is because nothing is being paid back. Blame gamers can come up with a million reasons and most of the arrows are aimed at the banks. Their aim is way off. The aimming point should be at the people who don't pay. This bullcrap about worthless degrees from for profit schools and high interest rates are nothing but smoke screens to cover for people who choose not to pay their debts. Most folks spend time researching which car to buy, TV, home, even an air conditioner and they know if they buy on credit and don't pay they run the risk of haveing the item reposessed. Hard to take away someones sheep skin. If one is smart enough to go to college, one should be smart enough to read the fine print and have enough sense to know there better be enough income coming in to pay all debts. There is no excuse for not paying your bills. If you can't pay...don't play. Taxpayers don't need another mess to clean up.

May 10 2013 at 1:25 AM Report abuse rate up rate down Reply
andreiib

Here's what needs to happen. Warren's idea is a step in the right direction but needs to go further. Student loans need to be at a LOWER rate than anything else. We should not have to import educated people from overseas to do work. Conservatives, this is a recipe for the collapse of this country. People also need to be able to put student loans on a bankruptcy!!! Banks and businesses can wipe out bad decisions and debt to start over. Why should people not be able to as well? The govt also needs to do a lot to lower the cost of education. A good place to look would be overpaid leaders and bloated sports program (my old alma mater can't seem to build a decent library but our stadium is state of the art!). Also, these fly by night educational institutions that cropped up under Reagan need to be destroyed. They overcharge for an education that is worthless and nontransferable.

May 10 2013 at 12:21 AM Report abuse +1 rate up rate down Reply
1 reply to andreiib's comment
cpo1514

The USA can always EXPORT Politically Correct graduates to the countries that oppress women... Obama can then win the war on women !!!!!

May 10 2013 at 10:02 AM Report abuse +1 rate up rate down Reply