Newspaper article The Florida Times Union

Student Loan Rates Await Fix; First Coast College Students Are Leftto Face Dramatic Impact, Official Says

Newspaper article The Florida Times Union

Student Loan Rates Await Fix; First Coast College Students Are Leftto Face Dramatic Impact, Official Says

Article excerpt

Byline: Drew Dixon

The impact of the interest rate hike on federal student loans will be dramatic for First Coast college students, if the increase that more than doubled rates remains in place by the time students return to class this fall.

"It can have pretty serious implications," said John Yancey, interim assistant vice president for enrollment services at the University of North Florida. "When you're doubling that interest rate, even though it's a relatively small rate to begin with, the impact is very significant."

As of Monday, the interest rate on federally subsidized Stafford loans for undergraduate students jumped from 3.4 percent to 6.8 percent because of congressional gridlock on settling the federal rate. That increase could cost students as much as $2,600 more in accrued interest for each student loan they obtain, according to an Associated Press report.

The rate increases will not impact any student loans already issued.

Yancey said more than 7,000 students each year out of the total student population of about 16,000 at UNF alone, where tuition costs about $5,000 per year, will be impacted. He said a majority of students on the Southside campus in Jacksonville get some sort of student loan before they graduate.

Yancey added the interest rate spike that was implemented Monday was the most substantial increase in student loan rates he's seen in his 16 years of dealing with financial aid issues at UNF. He is doubtful that rate will remain in effect by the time classes resume for fall semester in August.

Yancey said for the moment, the impact may be nil because students don't begin applying for student loans until just before fall session. He said his office has received few calls, but that may be because many students already are aware of the situation and it is the Fourth of July holiday week.

Members of U.S. Congress have vowed to return to Capitol Hill after the Fourth of July break to grapple with the student loan flap and return the interest rates to a lower level. …

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