The email urged students to contact their Congressional reps about the issue
VANCOUVER (CUP) — American students may have been surprised to see the name Barack Obama in an email from UBC.
Late last month, UBC sent a broadcast email to U.S. students informing them that interest rates on their government loans could double without congressional action.
“The 2007 College Cost Reduction and Access Act, which capped interest rates of subsidized U.S. loans at 3.4 per cent, is set to expire on June 30, 2012,” wrote Jonathan McCauley, UBC’s manager of student services and policy, in the email. “The expiration of this Act would raise interest rates back to the original 6.8 per cent, unless the U.S. Congress can pass a bill before July 1, 2012 to extend the current interest rate by one year.
“No matter your political stance, I want to invite you to contact your representative in Congress by phone, email, Twitter or Facebook and have your voice heard on an issue that may directly affect you,” he wrote.
UBC wanted to ensure American students were aware that the cost of repaying their student loans could increase, said Anne DeWolfe, director of Student Financial Assistance and Awards. According to DeWolfe, the cost of paying off the average student loan could increase by $1,000 if new legislation is not passed.
Emma Thompson, a Sauder student from Colorado, said she took out close to $5,000 this year in government-subsidized Stafford loans. She said that an increase in interest rates would hurt, but that she would take on more debt in order to graduate. According to The New York Times, the average student with Stafford loans graduates with close to $13,000 in debt.
“It wouldn’t be ideal, but if I had to to pay for school, I would make that sacrifice,” she said. “But I’d really like to not pay double.”
Thompson said she was happy that UBC was keeping students informed, especially during exam time. DeWolfe said the university was concerned that exam-addled students might be blindsided by news of a rate increase.
“If a bill does not pass, then we didn’t want to be criticized later as not having advised students,” said DeWolfe. “They could have taken some action if they wanted to. And if they don’t, that’s fine too.”
Around 450 UBC students receive loans subsidized by the U.S. government, said DeWolfe. She said UBC processes and disperses close to $7 million per year in student loan money from the U.S. Department of Education.
Last week, the Republican-controlled House of Representatives passed a bill that would take $5.9 billion from the 2010 Affordable Care Act, Obama’s health care reform bill, to maintain the 3.4 per cent interest rate. Democrats favour a plan to maintain the lower rate by closing tax loopholes for wealthy business owners.
Obama has said he will veto the Republican proposal.
“We certainly hope that Congress sorts this out and that the interest rate will stay low,” said DeWolfe. “Canadians enjoy a pretty good interest rate, and we’re just hopeful that the Americans will continue with the low rate they’ve had.”
