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!