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College Cost Reduction Act
The health of our economy relies on a highly-skilled and well educated workforce. College access is essential to remaining strong in the face of an increasingly competitive global economy.
In 2001, more than forty three percent of college graduates borrowed to pay for their education. The typical student who borrowed incurred an average debt of $15,140. Loans constitute an increasing share of a student's financial assistance. This year's loans constitute 52% of all financial assistance to undergraduate students.
Over the past decade, American college students and their families have shouldered a heavy burden of debt to pay for higher college student loan rates in addition to tuition and fee increases. Cutting interest rates on student loans will help millions of working and middle-class students and their families by saving thousands of dollars in student loan payments.
Congress passed the College Cost Reduction Act in September of 2007. This bill will boost college financial aid over the next five years by about $18 billion by increasing the maximum value of the Pell Grant and cutting the interest rate in half for undergraduate, subsidized student loans. The legislation provides tuition assistance to students who have agreed to teach in high-poverty schools or in subjects with a high demand for teachers, and forgives the loans of undergraduates who decide to go into public service professions. It also provides funding for schools to help ensure that low-income and minority students graduate high school and prepare them for higher education.