A week after the Senate overwhelmingly passed a student loan fix, the House followed suit.
On Wednesday, the U.S. House of Representatives passed a student loan bill giving potential financial relief to future college students. The measure would tie interest rates on federal student loans to the financial markets, in effect, lowering rates over the next few years.
According to figures from the Congressional Budget Office, tying the current system to a market-based rate will save taxpayers $715 million over ten years. However, some warn that as the economy improves, the interest rates will rise.
The House passed the measure on a 392-31 vote, about a month after the interest rate for new, federally subsidized Stafford loans doubled.
Congressmen Rick Crawford (R), Tim Griffin (R) and Steve Womack (R) voted for the measure. Cong. Tom Cotton (R) opposed it. Both Arkansas Senators voted for the bill last week.
“When Washington politicians dictate student-loan rates, they end up hurting students and taxpayers alike,” Cotton said in explaining his vote against the bill. “It’s causing tuition costs to skyrocket, leaving students buried in debt, often without jobs, and forced to delay buying a home and starting a family. As students struggle to repay their loans, taxpayers are on the hook for a $100 billion bailout. A better path is to repeal Obamacare, which nationalized the student-loan business, and let Arkansas’s hometown banks work with students and families to finance education, just as they do with homes, farms, businesses, and other loans.”
Griffin, who supported the bill, urged the President to act quickly on the measure.
“The House passed this bill more than two months ago in order to prevent interest rates on subsidized Stafford loans from increasing on July 1 and end Washington’s ability to use student loan rates as political bargaining chips, and I’m glad that Senate Democrats finally chose to act on it and stop playing partisan politics,” Griffin said. “This bipartisan solution is a long-term fix that makes things right for students, provides certainty and protects hardworking taxpayers by coupling rates with the government’s cost of lending. I urge President Obama to sign this bill quickly.”
The president has said he plans to sign the bill into law.