Loan rates increase, could mean nearly $3,000 more in college loans for PA residents

HARRISBURG (U.S. Newswire) – Pennsylvania students have to pay $2,330 to $2,803 more in college loans beginning Saturday, according to a new report released by the research arm of the Campaign for America’s Future.

College students and graduates will be pushed deeper into debt as interest rates on Stafford loans — the basic student loan — rise from 5.3 percent to 7.14 percent on old loans and to 6.8 percent on new loans at the end of this week.

Parents who take out PLUS loans to help their children pay for an undergraduate education also face rising interest rates. This Saturday, rates on PLUS loans will increase from 6.1 percent to nearly 8 percent for existing loans and to 8.5 percent on new loans, costing the average parent nationally an extra $3,000 and $3,953 respectively.

The rising interest rates come at a bad time for American families attempting to pay for college. Tuition at the average four-year public university has increased by 40 percent since 2001, and nearly two-thirds of all four-year college graduates now have student loans. Students and their parents are going further into debt, creating a burden that is often unsustainable. Student loan debt already causes 14 percent of young graduates to delay marriage; 30 percent to hold off on buying a car; 21 percent to postpone having children; and 38 percent to delay buying a home.

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