The Student Aid and Fiscal Responsibility Act (HR 3221) delivers on President Obama's promise to restructure student lending and put the interests of students ahead of those of banks.
Currently, the majority of "federal" education loans are actually made by private lenders. Under the Federal Family Education Loan Program, the government subsidizes these loans, and guarantees that the lenders will be repaid.
Taxpayers are putting billions of dollars into a system that gives lenders all of the profits and none of the risks. It's time to cut out the middleman.
In addition, private lenders tack on fees and create a risky environment for students and graduates. We deserve better, and direct loans will add complete reliability, even in an economic crisis.
This bill would reduce government costs by $87 billion over the next ten years, according to the non-partisan Congressional Budget Office. That money will be used to provide Pell Grants to help low-income students afford college, improve early childhood education, and reduce the federal deficit. It's an investment in our future in multiple ways.
For more information about the need for student loan reform, click here.
Write to your representatives today, and tell them that it's time for the government to start investing in people, not in banks!
The current system of student lending isn’t working. The majority of “federal” loans are actually made by private lenders, and their availability is prone to market swings and instability. These private lenders are not consumer-friendly, and are making it even harder for our students to be successful. These loans are costing the government billions of dollars in subsidies, on top of the federal guarantees that allow the private lenders to reap generous profits while taking none of the risk.
The Congressional Budget Office has predicted that this legislation will generate $87 billion in savings over the next ten years. That is money that can be spent on Pell Grants, ensuring that low-income students are allowed equal-opportunities to attend college, and on early childhood education. $10 billion will be set aside just for reducing the federal deficit. It’s an investment in our future in multiple ways.
Please support the Student Aid and Fiscal Responsibility Act for the sake of individual students, the economy, and all Americans.