Loan cuts could hurt students

President Bush just released his 2008 budget proposal and, if it were to become law, it would greatly affect college students. The proposal includes $19 billion in cuts to the federal family education loan program.

Eighty percent of higher education institutions and students rely on this financial aid program, which is why concerns are rising.

Sallie Mae, a provider of student loans, has voiced its concerns about Bush’s proposed cuts.

The cuts are going to impact the discounts on the loans they offer and the level of support Sallie Mae can give to private loans, Conwey Casillas, director of public affairs for Sallie Mae, said.

“The level of cuts in the president’s budget would also impact service levels,” Casillas said, while adding that face to face consultations dramatically help families when working with loans.

Casillas also said that the competition between student loan programs actually benefit students, but with the budget cuts there will be reduced competition, making loans more expensive. He said these cuts will force families to turn to much higher risk loans as well.

Martha Holler, managing director of corporate communications for Sallie Mae, said Sallie Mae feels like it is time to increase higher education, not cut out financial aid programs. She said their goal is, and always has been, to increase access to higher education for all Americans. Casillas then commented that Sallie Mae has helped an excess of 21 million do exactly that.

Included in this budget proposal is the cutting of the Supplemental Educational Opportunity Grant Program, as well as an increase to the Pell Grant. Norm Bedford, associate director for operations for financial aid, said that if the SEOG is cut, students might lose money in the short run, but in the long run, it will help students to actually receive money.

“The increase in the Pell grant will make up for that in the long run,” Bedford said. Bedford also said these cuts are the “republican response to trump the democratic response.”

“It’s a lot of support for me being here,” senior David Taranto said, adding that the loan cut is important to him because he has taken loans out to pay for college.

“I think the loans are very important,” said freshman Meagan Aliff. “A lot of people will lose their opportunity to get an education.”

To continue to help students with their financial needs, Sallie Mae has developed a program called UPromise, which allows students to pay off loans doing what they already do every day.

Members can earn rebates that can be transferred to college savings accounts or other higher education expenses by shopping online, eating out, buying gas or groceries or by purchasing other goods and services from more than 500 participating companies. Not only can students earn these rewards by themselves, but family and friends can join UPromise and link their account with students.

Holler said the biggest high school graduating classes are coming up, and it is important “our country be ready to offer those graduating high school students the investments they need.”