News

Bill will help graduates repay college debt, Durbin says

Posted August 12, 2007 11:00 pm

CLARE JELLICK

U.S. Sen. Dick Durbin remembers when he fretted over $7,500 in student debt.

Now that amount is laughable. The average student starting college this fall will graduate owing more than $20,000 in debt.

On Monday, Durbin said a bill that recently passed in the U.S. Senate will help ease the burden.

"We had a daughter and a baby on the way, and I said there is no way we're going to be able to pay off this student debt," Durbin, D-Ill., recalled at a news conference at Bradley University on Monday. "I think that most students today facing even more debt will understand that the provisions of this act will make it possibile for them to pay it back and possible for them to pursue their dreams."

The bill would create $17 billion in new grant aid, $850 million of which would go to Illinois students over the next six years. It would also increase the Pell Grant maximum award from $4,310 this school year to $5,100 the following year.

Pell Grants go to low-income students and don't have to be repaid.

A similar bill has passed in the House, and Durbin is optimistic the differences between the two bills will be resolved in "conference committee" by the end of the year. The house bill features smaller Pell Grant increases but it cuts interest rates on student loans, a Durbin spokesperson said Monday.

At the news conference in the Cullom-Davis Library, student Joey Ortega said he will be $25,000 in debt when he graduates despite taking advantage of multiple Pell Grants.

"Having that extra (money) will definitely help students in the future because it's really difficult starting into the real world knowing that I have all this debt to overcome," said the student majoring in electronic media.

Other features of the Senate bill include a cap on monthly loan payments at 15 percent of a person's "discretionary income;" forgiveness of any balance after 25 years of paying at this level; forgiveness after 10 years for people in public service professions such as teaching or law enforcement; and more stringent rules for schools and loan companies that share relationships.

"The bill also goes a long way to bringing some transparency and disclosure when it comes to the arrangements between many student lenders and universities … We have a new standard of conduct and ethics that's going to eliminate these kinds of abuses," Durbin said.

While this bill goes a long way toward making higher education more affordable, he said, there's still more work to be done. For most students graduating from public universities, 25 percent of their debt is from textbooks, he said.

In March, Durbin introduced a bill that would require some colleges to publish textbook prices for courses. He said he also wants students to be able to shop around for the cheapest textbooks.

"I think (textbook identification) numbers should be published for students to go shopping … That would give students an opportunity to bargain and try to find something less expensive,' Durbin said.

Clare Jellick can be reached at (309) 686-3112 or cjellick@pjstar.com.

Article Categories
News