June 15, 2007

House passes College Cost Reduction Act of 2007

Posted in Consolidation, Parent PLUS Loans, Stafford Loans, Student Loan News, The Financial Aid Process at 7:05 AM by Joe From Boston


A very interesting article on nchelp.org:

House Passes College Cost Reduction Act of 2007

As reported in yesterday’s briefing, the House Education and Labor Committee passed legislation by a 30 to 16 vote with all Democrats supporting the bill and the support of three Republicans.

The bill would cut roughly $19 billion from lender and guarantor fees and redirect these funds to student aid. Republican committee members stated that the Democrat’s proposal was “extracting too much blood” from lenders. Congressman Keller (R-FL) stated, “We’ve gone clean to the muscle and all the way to the bone,” in reference to the reduction of subsidies.

Ranking Member McKeon (R-CA) offered substitute legislation that would have cut lender and guarantor payments by roughly $13.8 billion and redirected those funds to Pell grants. Additionally, his legislation would have corrected current law to equalize Direct Loan and FFEL PLUS loan rates at 7.9 percent, invested $12 billion in Pell grants to increase the maximum grant by $350 in 2008, provided approximately $2 billion for deficit reduction and created no new entitlement spending. His proposal was not approved by the committee.

Press releases from Congressmen Miller and McKeon and further coverage by Congress Daily, CQ, Reuters, NASFAA, Inside Higher Ed, and the New York Times are included in the expanded edition of the Briefing.

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8 Comments »

  1. Robert Milbourne-Jackson Pence said,

    Hi Marshe,
    We have the same family name “Milbourne-Jackson”. Please contact me as I would love to know more about your family. My family was originally from England, Scotland and Ireland.
    Thank you , I look forward to hearing from you.

    Robert

  2. Marti – what are you trying to apply for? This post was about a Congressional bill, so I’m confused as to what you’re referring to.

  3. Marti M. McCall said,

    How can I apply?

  4. Hi Donna,

    No a federal interest rate cut will not affect PLUS loan rates.

    It literally takes an act of Congress to change the rates, and this is done typically each May.

    Current interest rates are taken into account when resetting PLUS interest rates, so if the rate is cut multiple times before May, it is reasonable to guess that PLUS loan interest rates might go down. There is no guarantee, however.

  5. Donna Carpenter said,

    Would Parent Plus loan rates be affected by the interest rate reduction?

  6. HI Marshe,

    I haven’t found any information on how you can apply for these benefits yet. Not to disparage our government, but they don’t work that quickly. 🙂 Indeed, many of the provisions in the bill don’t take effect until July 2009. I did find the official website from the Education and Labor Committee in the House of Representatives. They have a whole section of their website on the CCRA, which you can access here: http://edlabor.house.gov/micro/ccraa.shtml

    The “Who benefits” page, located at http://edlabor.house.gov/micro/ccraa_whobenefits.shtml says the following:
    “Public servants will receive complete loan forgiveness after 10 years of service – providing help to men and women serving in the military, first responders, law enforcement officers, firefighters, nurses, public dfenders, prosecutors, early childhood educators and others.”

    Good luck!

  7. Marshe' Milbourne-Jackson said,

    I am trying to find out how to determine if I qualify for the loan forgiveness law President Busch passed on October 1, 2007 under part of the College Cost Reduction and Access Act. If you could provide me with the information on how to apply to determine if I qualify, I would greatly appreciate it. Thank you in advance for your assistance!

  8. […] passes College Cost Reduction Act of 2007 House passes College Cost Reduction Act of 2007 A very interesting article on nchelp.org: House Passes College Cost Reduction Act of 2007 As […]


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