College students may soon face higher loan repayment rates - KWWL - Eastern Iowa Breaking News, Weather, Closings

College students may soon face higher loan repayment rates


358 students are now starting a new chapter after graduating from Wartburg College in Waverly Sunday. 

But many of the graduates now face a harsh reality:  finding a job, and beginning to pay off student loans, and loan repayment could get more costly for some of them.

Members of Wartburg College's class of 2013 are thrilled to finally be getting their hard-earned degrees.

"It's really exciting.  You work hard for four years, and it's finally here," said graduate Kelsi Sawatzky.

For many graduates, graduation is the end of years of schooling.  But Sawatzky still has a lot of education left to pursue.

"In August, I'll start optometry school," she said.

Those are classes that, as many of the graduates know, don't come cheap! 

"I will have to take out a lot more loans.  So hopefully I'll be able to pay those back!" said Sawatzky.

Students in this year's graduating class with federally subsidized loans will be able to repay them at a low interest rate of just three percent.  But for those furthering their education, those rates are set to double, to over six percent on loans taken out after July 1st.

"I'm not too nervous.  I haven't really thought that far ahead yet!" Sawatzky said.

But for many students yet to get their diploma, the thought of higher loan repayment rates is a concern.

"It's a pretty scary thing, especially considering how quickly we have to pay student loans after graduation.  So not only do you have to worry about finding a job right away, but also paying the loans right away," said Wartburg student Kyle Scobee.

Scobee's had the smarts to start saving money for it now, but he knows his concerns are shared by a lot of students, all who are hoping Congress acts to avoid the loan rate spike.

"We want our students to be educated, to pursue education.  If we get heftier student loan payments, it's going to stop students from going to college, and we want to keep pursuing education and bettering ourselves.  So if we can do anything to continue that growth, we definitely want to keep doing it," Scobee said.

Even with a lot of loan debt, Scobee and the graduates are proud of their accomplishments, and hope the cost of their degree will be worth it in the long run.

A vote on the first bill to prevent student loan interest rates from rising failed to pass in the US House last week.  But talks of a compromise deal are ongoing.

You may recall student loan rates almost doubled last summer during the "debt ceiling" debate, but a last minute deal prevented that from happening.

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