Stop Student Loan Interest Rate Increases!

As physicians-in-training, we are among the 20.4 million student affected by the exploding cost of higher education in the United States. More than 7 million of us rely on Stafford loans to pay for school and will be directly affected by interest rate increases set to take effect on July 1, 2012. If Congress does not take action in the coming weeks, undergraduate and professional students will be forced into increasing debt, limiting our education and career choices. Moreover, because of the nature of medical training, these interest rate hikes have a disproportionate impact on future physicians. On July 1, 2012, the following changes will take effect:

  • Subsidized Stafford loans for graduate and professional students will be DISCONTINUED. This means that medical students will only be eligible for unsubsidized Stafford and GRADPlus loans, meaning interest accrues and capitalizes during medical school. 

  • Undergraduate subsidized Stafford loan interest rates will DOUBLE. This means that rates on these loans will increase from 3.4% to 6.8%. 

To add insult to injury, Republicans in Congress have introduced legislation in the House (S. 2366) and Senate that would defer the undergraduate subsidized Stafford loan interest rate increases by cutting the Prevention and Public Health Fund, a critical piece of the Affordable Care Act. Democrats in the Senate introduced S. 2343, the Stop the Student Loan Interest Rate Act would have prevented the undergraduate Stafford interest rate increase by closing a corporate tax loophole. Unfortunately, this bill stalled in the Senate last week and would not have addressed the elimination of subsidized Stafford loans for graduate and professional students.

So what can you do?

Let your members of Congress know that protecting corporations at the expense of students and prevention is not acceptable!