NEW YORK - Sen. Charles Schumer called on the federal government Monday to protect student loans as it implements the $700 billion bailout amid a credit crisis that has students worried they won't be able to pay for college. If the nation can't ensure that students who deserve to go to college can pay for it, “the price we'll pay will be that of a generation,” Schumer said outside Stuyvesant High School in lower Manhattan as the stock market swooned a mile away.
Schumer said he sent a letter to Treasury Secretary Hank Paulson and Federal Reserve Chairman Ben S. Bernanke urging them to pay attention to the student loan market as they begin to implement the financial-sector rescue plan.
A tighter credit market could force students or their families to pay higher interest rates on loans, or not be able to qualify at all, the senator said. A number of lenders already have gotten out of the student-loan industry.
It's a concern for Susan Levinson, a senior at Stuyvesant, a prestigious public school known for its top-notch academics.
“It might jeopardize my chances” of going to the college she hopes for, the student said.
The financial crisis continued to worsen Monday, with the Dow Jones industrials plunging more than 800 points before closing down about 370 points. The stock market bellwether ended the day at its lowest level since 2004.
About $60 billion - nearly half of all public and private student-aid money - comes via the federal student loan program.
Currently, there are two parallel systems: Students can borrow directly from the government, or take out loans from banks and other private lenders subsidized by the government.
Schumer recommended that all colleges let students get loans directly from the federal government, instead of having them go through a private institution as a middleman. Schumer said he was sending letters encouraging all New York college presidents and the American Council on Education to do so.
Congress last month approved a measure that will allow students who rely on loans to continue their educations, regardless of current difficulties in the private credit market. The program is in place through the 2010 school year.
A tighter credit market could force students or their families to pay higher interest rates on loans, or not be able to qualify at all, the senator said. A number of lenders already have gotten out of the student-loan industry.
It's a concern for Susan Levinson, a senior at Stuyvesant, a prestigious public school known for its top-notch academics.
“It might jeopardize my chances” of going to the college she hopes for, the student said.
The financial crisis continued to worsen Monday, with the Dow Jones industrials plunging more than 800 points before closing down about 370 points. The stock market bellwether ended the day at its lowest level since 2004.
About $60 billion - nearly half of all public and private student-aid money - comes via the federal student loan program.
Currently, there are two parallel systems: Students can borrow directly from the government, or take out loans from banks and other private lenders subsidized by the government.
Schumer recommended that all colleges let students get loans directly from the federal government, instead of having them go through a private institution as a middleman. Schumer said he was sending letters encouraging all New York college presidents and the American Council on Education to do so.
Congress last month approved a measure that will allow students who rely on loans to continue their educations, regardless of current difficulties in the private credit market. The program is in place through the 2010 school year.
The Citizens' Say
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Farmer's Gal wrote on Oct 7, 2008 10:25 AM: