Yep, that’s right. The House (of Reps) ratified the Deficit Reduction Act. This is another example of things that just don’t make sense to me. Here’s the deal:
They want to cut $39.5 billion through 2010 from the federal budget; thus saving taxpayers almost $40 billion.
That sounds all kosher and all. It seems to be great for most ppl, the average taxpayer will save about $300 (I’m not clear if this amount is per year, or over the next 5 years; but prob over the next 5). I’m sure most of the ppl who read my blog have student loans though. For kids currently in college, it opens up some options & increases the amount of moolah they (& their fam) can borrow. It’s going to cut about $12.7 billion from student loans, but will allow kids to borrow more money. Don’t ask me how that works, it all seems very contradictory to me.
But for those of us paying on loans cause we’re all done w/ our educatin, & we’re now trying to be productive, contributing members of society; we’ll have to pay more in interest.
Starting in July, parents who have the PLUS loan will have an interest hike from 6.1% to 8.5%. That’s about 800,000 parents across the US. A lot of these parents are single-parents w/ only one income trying to help their (multiple) kids through school.
And for the nearly 10 million kids (TEN MILLION ppl!!) out there who have a Stafford Loan, your interest is gonna go up to 6.9% (from the current 5.3%). I know that for those of you making payments, you already know that 5.3% is already a hike from what it was.
It’s supposed to be a good thing: lower loan fees & higher loan limits. But it seems to be a temporary good thing. Cause in the long run, they’re killin us in the interest. That’s just my take on it all, though. And I’m not pretending to understand a lot of it.