New Bill Aims to Make Student Loans More Affordable and Accessible in South Dakota
A Senator from South Dakota introduced a bill that aims to offer students a more accessible and affordable loan choice.
Senator Mike Rounds’ bill aims to involve the private sector in student loans, while also harkening back to previous policies.
When you attend an undergraduate institution, the federal government will cover most of your loan expenses if you borrow from approved lenders.
“The federal government will ensure that 98% of the loan is guaranteed to the banks, eliminating any risk. The banks are expected to show interest in this opportunity, as it has proven successful in the past before being replaced by the current plans,” stated Rounds.
A letter was sent to Senator Rounds on Tuesday, in which the America’s Credit Unions and Dakota Credit Union Association expressed their endorsement of the bill. They believe that the bill will enable the industry to effectively cater to the needs of their more than 140 million credit union members across the country.
“We have the resources and personnel available to assist you with any inquiries you may have regarding our program,” stated Jeff Jorgensen, President of Bluestone Federal Credit Union. “Our team is more than willing to sit down with you and provide the necessary support.”
Jorgensen mentions that his company continues to receive daily phone calls inquiring about the possibility of obtaining a student loan, which they must redirect to the federal government.
The bill permits individuals to access loans of up to $19,000 per year, which is in line with the average expenses associated with attending a public university and is adjusted for inflation. Interest does not accumulate while students are attending school.
In addition, there will be two repayment options available, one of which is based on your income. You have the option to choose between a 15-year installment plan with no penalties for paying early or an income-driven repayment plan. It is accessible to undergraduates or students attending trade schools.
The goal is to assist middle-class students who frequently have to forgo college to some degree.
Rounds assure that the bill will not hinder governmental-based student loan programs, even though it does not mandate filling out the FAFSA form.
