Student Loan News – August 16, 2013

Here are the best articles from around the web this week talking about student loans…

For the week ending Friday August 16, 2013

Student Loan News:

1. Obama Signs Student Loan Deal:

President Barack Obama signed into law Friday a measure restoring lower interest rates for student loans, pledging the hard-fought compromise would be just the first step in a broader, concerted fight to rein in the costs of a college education.

Encircled by lawmakers from both parties in the Oval Office, Obama praised Democrats and Republicans alike for agreeing finally on what he called a sensible, reasonable approach to student loans even as he cautioned that “our job is not done.”

“Feels good signing bills. I haven’t done this in a while,” Obama said, alluding to the difficulty he’s faced getting Congress to approve his legislative priorities, such as gun control and budget deals. Get more: http://swampland.time.com/2013/08/09/obama-signs-student-loan-deal/

Student Loans

2. Household debt falls, but student loans still weigh heavy:

The U.S. economy has been growing at a glacial pace for the past four years. And, by almost all tellings, the overhang of debt from the pre-crisis years is a big part of the reason. Americans have been paying down debts and building up savings, not using additional income to buy more goods and services and fuel more economic growth.

So far, so good. But what's really happening with household debt in the United States, and what does it augur for the future? The New York Fed's quarterly report on household debt provides some of the best data. More info: http://www.stltoday.com/business/local/household-debt-falls-but-student-loans-still-weigh-heavy/article_82997606-7b65-5c69-9558-04a6c785e691.html

3. Student Loan Act Could Mean Higher Federal Profits:

The Bipartisan Student Loan Certainty Act of 2013, which President Barack Obama officially signed Aug. 9, is touted mostly as a retroactive fix for the July 1 doubling of the interest rates on subsidized federal direct loans. But the truth is that Congress has simply kicked the can down the road.

The new law offers a moderate amount of help to current students at the expense of future ones. And it does nothing to address what the Student Loan Ranger sees as a fundamental problem in the student loan system the huge profit the federal government is making at the expense of students. Discover more: http://www.usnews.com/education/blogs/student-loan-ranger/2013/08/14/student-loan-act-could-mean-higher-federal-profits

Student Loan Blog Posts:

1. Remarks by the President at Student Loans Bill Signing:

Well, before I sign this, I just want to say thank you to this extraordinary coalition that helped make this signing possible. I want to thank Chairman Kline, all the members of both House and Senate from both parties that came together to design a sensible, common-sense approach to keeping student interest rates at a reasonable level so that young people have a better opportunity to go to college, get the education that they need not only to better their own lives but also to strengthen the country’s economy.

And I want to thank the advocates, including some of the young people I suspect will be benefiting from lower student loans — or lower student loan interest rates — because without their voice, without their participation, we probably would not have gotten this bill done. Original article: http://www.whitehouse.gov/the-press-office/2013/08/09/remarks-president-student-loans-bill-signing

2. Record Student Loan Debt Crushes American Enterpreneurial Spirit:

Freshly-minuted MBAs “are willing to sleep on a couch for a year or two, but they can't do it with the burden of student loans,” is how on senior lecturer describes the entrepreneurial-spirit-sucking debt loads that college-leavers face in the new normal. Faced with mounting monthly payments, the WSJ reports that would-be-Bezos have little choice but to look for the steady paychecks that accompany a regular job. Recent surveys find that “the single largest inhibitor to entrepreneurship is the student loan” burden and it seems states are beginning to realize this growth-inhibiting reality. In order to tamp down ambition-busters such as “I would be a serial entrepreneur if it weren't for my student loans,” California (and Rhode Island) are enacting legislation to reduce college costs and looking at the feasibility of temporary forbearance. Details here: http://www.zerohedge.com/news/2013-08-14/record-student-loan-debt-crushes-american-enterpreneurial-spirit

3. Student Loans Influence College Lifestyle:

As college costs rise, so does the proportion of students who seek a loan to pay for their education.

Sixty percent of college students are in debt to cover costs and, according to a new study, students’ college experiences are largely shaped by the debt they accrue.

Indiana University researchers study found that debt-free students are more likely to live the “play hard” lifestyle often associated with the college years, where social lives can trump academics. Open this article: http://psychcentral.com/news/2013/08/13/student-loans-influence-college-lifestyle/58347.html