State PIRGs' Higher Education Project
218 D Street SE
Washington, DC 20003
(202) 546-9707

Director:
Ivan Frishberg

Advocate:
Ellynne Bannon

 

November 14, 2001

Dear Representative,

I am writing to urge you to support H.R. 1622, the Affordable Student Loan Act, introduced by Representative George Miller. The Affordable Student Loan Act will help to make college more affordable and ease the burden of student loan debt.

A college education is one of the best investments of a lifetime. In the workforce, a college degree is worth 75 percent more than a high school diploma, or $600,000 over the course of a career. However, the rising cost of a college education causes students to shoulder increasingly large loan burdens. Student loan volumes have more than doubled in the last seven years to $35 billion a year.

New data from the Department of Education shows that the average student at a four-year public college graduates with $16,243 in loan debt. At four-year private colleges the average debt total jumps to $17,613. Students who graduate with high loan debts are more likely to default on their loans, delay major purchases and forgo public service.

Exacerbating the situation, the federal government charges fees of up to four percent of the loan principal. These fees were instituted in 1981 to help reduce the deficit. Currently the government actually makes money from the student loan program.

For students, the fees on student loans come at the worst possible time; when the money is needed to pay for books, tuition, and living expenses. Origination and insurance fees are monies that are never seen by the student, but accrue interest and add to the burden of paying back the loan after graduation.

As student loan burdens rapidly increase, H.R. 1622 is an important step in preserving higher education access to students. The Affordable Student Loan Act eliminates origination and insurance fees on federal student loans and would save a typical student $677 on their loans. I urge you to support H.R. 1622.


Sincerely,

Ellynne Bannon
State PIRGs' Higher Education Advocate