On Wednesday, May 5th, Reps. John Boehner and Buck McKeon introduced H.R. 4283, the "College Access and Opportunity Act". The bill makes some positive changes. For example, it repeals the anticompetitive "single holder rule" that limits students' choices when selecting a consolidator.

However, part of the bill includes a tremendously negative change for students holding federal debt-particularly those who will graduate in 2005 or later. The amendment currently under consideration proposes changing the consolidation loan program from allowing a fixed rate to allowing only a variable one. Given that consolidation loans are the only way for students to lock in today's low federal loan rates and protect themselves against the upcoming increases in rates, eliminating fixed-rate consolidations could cost students thousands of dollars in interest payments.

Calculations from the Congressional Research Service showed that this change would cost the average undergraduate student over $5,000 in extra interest charges -- nearly a third of the average debt of $17,000. Even worse, students who pursue further study (such as a Master's or professional degree) graduate with debts that often exceed $100,000. The extra interest payments caused by variable-rate consolidation on professional school loans would be $30,000 -- a massive increase in the debt burden.

With student debt on the rise and an ever-challenging job market, fixed-rate consolidations are one of the most important means by which we can manage our debt and afford our education.

Therefore, please take the time to write or e-mail Reps. Boehner and McKeon or your own Representative. Let Capitol Hill know that this change hurts students' educational opportunities and access.

Take Action:

Contact Rep. John Boehner
Washington, D.C. Office
1011 Longworth H.O.B.
Washington, DC 20515
ph: (202) 225-6205
fax: (202) 225-0704

Contact Rep. Howard McKeon
2351 Rayburn HOB
Washington, DC 20515
ph:(202) 225-1956
fax: (202) 226-0683

E-mail your Congressperson:
1. Go to http://www.visi.com/juan/congress/ .
2. Enter your address into the box to find out who your Representative is.
3. Click on your Representative's email address once the system has found it.
4. Type in your message (there is a suggested sample letter below) and send it off.
5. Tell your friends about the proposed amendment and encourage them to take action as well.

 

Dear [REPRESENTATIVE NAME], As a student and as your constituent, I am asking you to oppose the provisions in H.R. 4283, the "College Access and Opportunity Act", that would change the consolidation student loan program from a fixed rate to a variable rate. Congress established the consolidation loan program to make education easier to afford, not harder. Fixed-rate loans allow students to benefit from low interest rates in a difficult job market, and are one of the few things keeping education affordable. H.R. 4283 does many good things, such as repealing the anticompetitive "single-holder rule", but changing consolidation loans to variable rate would erase all of this bill's benefits. Please keep Congress' promise to students and keep higher education affordable and accessible to all Americans -- protect the fixed rate consolidation loan program! Sincerely, [YOUR NAME]