The Barometer Online

Issue date: 7/8/09 Section: News

Media Credit: Barometer Staff

Many college students around the country have a reason to be excited.
As of July 1, 2009, new benefits that make student loans more affordable and manageable to repay went into effect.
The College Cost Reduction and Access Act (CCRAA), which was originally passed in 2007, guarantees borrowers will never have to repay more than 15 percent of their yearly income to student loans.
"I am pleased the College Cost Reduction Act is finally taking effect," said Peter DeFazio, U.S. House of Representative from Oregon's 4th Congressional District. "This is great news for Oregon students."
According to DeFazio's Web site, more than 40,000 Oregon students take out need-based student loans each year. The CCRAA will also offer loan forgiveness for college graduates that go into public service professions, including non-profit organizations, federal, state, and local government, public schools, and university employment.
After 10 years of work in the public sector and loan payments, any remaining debt will be completely forgiven.
A major benefit of the CCRAA will be the increase in Federal Pell Grant money. The Federal Pell Grant, which unlike traditional loans does not have to be paid back, has been increased by $600 above last year's award to eligible students. President Obama has recently been trying to take the Pell Grant out of the lawmakers' hands and give it a mandatory stream of money like Medicare and Social Security, according to PellGrantInformation.com.
This would greatly increase the number of lower income students who are able to attend college.
"It will help allow students from underprivileged areas get into college," OSU senior Matt Gonzalez said. Gonzalez is a new media communications major who relies on need-based financial aid to help pay his tuition.
"Hopefully it will help improve their way of life," he said.
According to DeFazio's website, more than 6.8 million students nationwide use need-based student loans each year, with the number increasing every year.
"We must ensure that a quality education is within grasp of every American," DeFazio said. The CCRAA is the next step in ensuring that students have an opportunity to attend universities and not have to be worried about how to pay for it.
"I think it's a great relief for those who are getting out of college, and planning to start a family," Gonzalez said about CCRAA's plan to cap repayment at 15 percent of discretionary income and possibly even lower, depending on the size of each borrower's family.
In addition to the other benefits of the CCRAA, student's interest rates will continue to drop on their loans from 6 percent down to 5.6 and will continue to drop until it reaches 3.4 percent in 2011, according to the current plan.
According to DeFazio, the CCRAA is the largest investment to help Americans pay for college since the GI Bill in 1944, while also adding no new costs to taxpayers.

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