Congressman Tim Ryan Calls for Refinancing Options as Interest Rates Drop for New Student Loans

May 14, 2015 Issues: Education

WASHINGTON, D.C.—Today, as new, lower interest rates were announced for student loans for the 2015-2016 school year, Congressman Tim Ryan called on House Republican leaders to schedule a vote on the Bank on Students Emergency Loan Refinancing Act (H.R. 1434), which Congressman Ryan is a cosponsor.

“I call on Speaker Boehner to immediately bring this legislation in front of the House for a vote. The price of college tuition in our country has increased by 1,200% since 1978, and our young people are drowning in the student loans they were forced to take out to cover these astounding costs. It’s common sense that we should allow those with existing student loans to have access to the lower interest rates available to new borrowers.

“What kind of future are we creating for our nation if our young people are strapped so much debt coming out of college that it’s impossible to buy a home, start a business or begin investing in their future? This is the reality for the majority of college graduates today, and we need to change this destructive system that is keeping Americans in perpetual debt. Passing this legislation is a small step that can help improve the financial wellbeing of hundreds of thousands in Ohio and across the nation, but it’s critical that we make comprehensive changes to the way we pay for higher education in the United States of America.”

This legislation would allow borrowers with high interest rates on their existing student loans in both the public and private markets to refinance these existing loans to lower interest rates. Under the bill, for undergraduate student loans, borrowers could refinance to an interest rate of 3.86 percent. Currently, some borrowers are paying interest rates as high as 7 percent on their existing loans.

Students enrolling in class this fall will benefit from lower interest rates, stemming from passage of the Bipartisan Student Loan Certainty Act in 2013, which Congressman Ryan voted in support of the Senate compromise bill which was signed by president Obama in August of 2013.