Many students could see an increase in student loan debt after Congress voted in June to make changes to student repayment plans.
Any student who took out a subsidized loan after July 2012 would continue to have a 3.4 percent interest rate and a six-month grace period after graduation before they are required to make payments.
The six-month grace period allows borrowers time to find a job before they have to begin making loan payments.
Unlike in past years, interest will begin accumulating during the grace period.
This means students can choose to begin paying their interest charge immediately after graduating or let it accumulate to the loan total.
Justice studies junior Juan Terrazas, who has taken out about $8,000 in unsubsidized loans, said he was unaware of these changes.
“I've never really worried too much because I'm not too much in debt,” Terrazas said.
He said he figures as long as he keeps his debt under $15,000 it won't be a lot.
Additionally, graduate students are no longer eligible for subsidized loans.
The federal government offers graduate students the option of direct loans or unsubsidized loans.
Interim Executive for Student Financial Assistance Melissa Pizzo said there was some communication to current students about the changes via their ASU email.
She said she is confident that students are alert to changes the government makes involving them.
“Our current students are pretty in tune,” Pizzo said, “They follow what’s going on at the federal level.”
In fiscal year 2011, 56 percent of ASU in-state students received a loan. These averaged to a little more than $7,000, Pizzo said.
Pizzo said there are options for students who are worried about their potential debt.
Information about the number of loans taken out by students this year is not yet available.
ASU financial aid gives scholarships, grants and jobs through work-study to students who qualify.
In the 2011 fiscal year, 60 percent of students had some sort of financial aid other than a loan, Pizzo said
Tourism development and management junior Gabrielle Rothrock owes roughly $4,000 in loans, including the one she took out this semester. She was also unaware of the recent changes.
Initially, Rothrock wasn't worried about taking out student loans.
She planned on interning while in school and finding a job after graduation, but she now feels that plan is unlikely in this economy.
"I'm worried, but there’s nothing I can do," Rothrock said.
For students like Rothrock, the federal government does offer some options upon graduating.
There are programs like Income-Based Repayment and Public Service Loan Forgiveness to help qualifying students alleviate the burden of their student loans.
Income-Based Repayment is a program where students who can demonstrate financial hardship can apply.
This takes into consideration your 10-year payment plan, income and family size.
As for the Public Service Loan Forgiveness, this is a program for those who commit to a full-time job in a public service job and have made at least 120 payments on their loan.
Reach the reporter at jaborbon@asu.edu
