Clearly Washington is listening to the radio show, or at least the Senate is, as they finally passed a bill for the future of student loan interest rates. The bill is in complete lock-step with what I proposed on the show just a few weeks ago. Interest rates on federally backed student loans went up on July 1st to 6.8%, which was double the 3.4% previously. This solution will now tie student loan rates to a financial market index, which means rates will go up or down based on the fluctuation of interest rates in the financial markets.
Some people are concerned that an improving economy will send interest rates much higher and therefore hinder students’ ability to repay their loans at higher rates. However, there are caps in place within the bill to keep student loan rates from getting too far out of control. Read the full article here: Senate passes bill on student loan rates.
I assure you this is the smartest thing that could possibly be done. It protects the Government from making bad monetary decisions by borrowing money in the financial markets and then loaning it out for a guaranteed loss to students. It also allows students to get lower interest rates without refinancing when rates go lower, like they are currently.
Anyone who has a problem with this bill is probably concerned that interest rates will sky-rocket and every student will be paying the cap-rate for their federal student loans. Just remember, interest rates do NOT have to go up. Even if the economy makes a full recovery, interest rates can still remain low. Especially when the Federal Government has $16,000,000,000,000+ in debt it must service. As long as that’s the case, you can expect them to do everything possible to keep interest rates low, so they can make the payments more easily.
Highlights from today’s Mr Credit Radio show below…
Listen to the podcast here:
– Doctors are now getting into Politics in an attempt to repeal ObamaCare. Read the full story here: Doctors’ Prescription for ObamaCare.
– Facebook has a great quarter, proves its the “real deal” and the best social media platform for advertisers as shares sky-rocket. Read the full article here: Facebook shares surge on great quarterly report.
– We talk student loan solutions with Jun Lee and Brian Blackburn from StudentLoanService.us – Totally mind boggling how much opportunity there is to get help with student loans through Government programs if you understand the system. If you or anyone you know needs help with student loans, give them a ring at 877.927.6864 and see how much you can save on your payments. People are qualifying for complete forgiveness without having to make any payments in some cases. It’s totally INSANE!