Alexander Announces Agreement To Reduce Student Loan Rates For More Than 200,000 Tennessee Borrowers

Thursday, July 18, 2013

The senior Republican on the U.S. Senate education committee on Thursday announced an agreement had been reached by senators of both parties on a plan to lower interest rates for all students borrowing money for college this year.

Senator Lamar Alexander (R, Tn.) said, “Today’s bipartisan student loan agreement is terrific news for about 202,000 Tennessee borrowers who will be taking out nearly $1.8 billion to help pay for college costs next year.”

Elements of the agreement are as follows:

  • Rates on every student loan made after July 1 will be reduced from 6.8 and 7.9 percent rates that are currently fixed in the law.
  • All undergraduate loans will have the same rate, which this year is 3.86 percent, and will remain fixed for the life of the loan.
  • The plan is simpler because all undergraduate loans—which are two-thirds of all student loans—will have the same low rate.

Senator Alexander said, “This plan is fair to taxpayers and fair to students. It comes as close as possible to not costing taxpayers and not charging students more than the cost of borrowing the money and administering the program.

“It’s realistic because it’s market-based, which means it’s based on what it costs the government to borrow money.

“The rates are fixed for the life of the loan, which provides certainty to students and parents.

“Finally, the plan is a long-term solution that will end the annual political saga of members of Congress jockeying for position to solve the student loans problem.”

The Bipartisan Student Loan Certainty Act requires that, for each academic year, all newly-issued student loans be set to the U.S. Treasury 10-year borrowing rate (specifically, the yield on the 10-year note as determined by the last auction held before June of each year—not the changing daily rate).

The resulting interest rates for loans taken out this year, after July 1, would be 3.86% for all loans for undergraduate students—both subsidized and unsubsidized. Rates would be 5.41% on unsubsidized loans for graduate students, and 6.41% on PLUS loans for parents and graduate students.

These rates would apply retroactively to newly issued loans taken out after July 1.  The interest rate would be fixed over the life of the loan to provide borrowers with certainty to plan for the future.  Additionally, this bill protects against the threat of unforeseen circumstances by imposing a cap to ensure interest rates never exceed 8.25% for undergraduate students, 9.5% for graduate students, 10.5% for PLUS borrowers.  The Congressional Budget Office has determined this legislation would save taxpayers $715 million over ten years.

To learn more about the bill, click here.


Shekari Challenges Congressman Fleischmann To Debates

Democratic Congressional candidate Melody Shekari challenged Representative Chuck Fleischmann to several debates on Tuesday . Citing previous years’ inadequate debates, Ms. Shekari requested at least four debates, one in each of the two most populous counties and at least two before polling begins in October. “The people will be making a choice in November and we should ... (click for more)

Erlanger Has Paid $4,185,558 To Atlanta Law Firm In Hutcheson Hospital Litigation

Erlanger Health System, responding to an Open Records request by attorney Stuart James, said it paid $4,185,558.39 to an Atlanta firm in the wide-ranging Hutcheson Hospital litigation. The summaries were provided by Erlanger’s outside counsel to the law firm of James, James and Joyner. Attorney James said, "A candidate for the sole commission seat in this fall’s race, ... (click for more)

Proud To Be A Conservative Conservationist

I was born and raised in Chattanooga and was brought up to be a Tennessee conservative. That means that my family conserved our spending, our resources, and yes, even our environment.  I think we were inspired to do so because Tennessee is one of the most beautiful places in the entire United States. We have stunning mountains, wild rivers and quiet backcountry. And many of ... (click for more)

Roy Exum: Why I Adore America

If Heather Cross weren’t married and didn’t have such a fine-looking family I’d swear I might propose. The dazzling lady just wrote a “By Gumbo! letter” to all the major news outlets in the world to inform them that half of the Pelican State is still submerged by “a 1,000-year flood” and where the heck are they with their cameras? She knows it is vital for the rest of America to ... (click for more)

Luthringer, Boyd Win Prep Cross Country Races

High school cross country runners didn’t get a break from the weather at Camp Jordan Tuesday afternoon. It was the first day of competition in the Chattanooga Cross Country League and even though the usual 5K distance was shortened to just two miles because of the heat and humidity, the effort was there as was plenty of sweat as 213 varsity runners representing 17 teams stepped ... (click for more)

Ooltewah Gets Past Improved McMinn, 3-0, In District 5-3A Volleyball

McMinn County may not be the patsy it once was on the volleyball court. Ooltewah, which have won a combined 26 regular season and District 5-3A tournament titles, 10 region tourney crowns and appeared in earned nine state berths with two second-place finishes, learned the Lady Cherokees have made significant improvement since the 2015 season. The Lady Owls (14-4, 4-0) ... (click for more)