Northern Iowan t h e u n i v e r s i t y o f n o r t h e r n i o wa’s s t u d e n t - p r o d u c e d n e w s p a p e r s i n c e 1 8 9 2
JULY 20, 2012
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VOLUME 108, ISSUE 60
FRIDAY
CEDAR FALLS, IOWA
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NORTHERN-IOWAN.ORG
FINANCIAL AID
Congress compromises on student loan interest rate Further reforms, regarding standardized aid award letters, a possibility KARI BRAUMANN Editorial Staff
After long debate, Congress reached a compromise June 29 extending the current interest rate on subsidized federal student loans. However, graduate and professional students will no longer be able to get subsidized loans, as part of the compromise. The interest rate on the subsidized loans, also known as Stafford loans, will remain at 3.4 percent instead of rising to 6.8 percent, the rate for unsubsidized loans. Five years ago, interest rates on the subsidized Stafford loans began decreasing annually as outlined in a law passed to establish fixed and more affordable interest rates for the loans. Part of the compromise to help fund the continued low rate resulted in a change to interest charges in the sixmonth grace period between the time a student graduates and enters repayment. Subsidized loans taken out
during the 2012-2013 and 2013-2014 school years will now begin accruing interest during the grace period instead of when repayment begins. However, the legislation does not change the key difference between subsidized and unsubsidized loans. The U.S. Department of Education will still pay the interest on subsidized loans while borrowers are enrolled in school. Generally, the continuation of the lower subsidized loan rate is “a good thing for this upcoming year,” said Tim Bakula, associate director of financial aid at the University of Northern Iowa. However, he said the measure is only a “temporary fix” for an election year. “Everything’s back on the table next year,” Bakula said. “It’s kind of buying a little bit more time. … (and it) will get tackled by whoever gets elected president next year.” As far as the change for graduate students goes,
Bakula said he hasn’t seen too much impact since the announcement that they would be unable to receive subsidized loans in the future. “It does obviously negatively impact them in their quest to keep interest rates down because they only have unsubsidized loan options now, but … I don’t think that is a huge factor in the making of a decision to come to grad school or not,” Bakula said. “If anything, it may cause them to think twice about it, which isn’t necessarily a bad thing.” Having loans at lower interest rates does help when a student is consolidating his or her federal loans. In the consolidation process, a new interest rate is calculated based on a weighted average of the all the student’s federal loans. The average is weighted based on the amount of money borrowed at each interest rate. Borrowing more money at a lower interest rate can help lower the consolidat-
NEWS IN PHOTOS: HUDSON ROAD BRIDGE CONSTRUCTION
COLBY CAMPBELL/Northern Iowan
Rachel Smithart, a junior sociology major and financial aid employee, assists Amy Halverson, a senior family studies major, at the Office of Student Financial Aid in Gilchrist Hall.
ed loan interest rate, Bakula said.
Other changes in the works Another possible change for student financial aid has yet to come to a vote in Congress. In May, Senator Al Franken, D.-Minn., introduced the Understanding the True Cost of College Act of
2012. The bill calls for a standardized financial aid award letter for all institutions of higher education receiving federal funds. The award letter would include various types of consumer information, including a list of costs, the amount of aid offered that < See FINANCIAL AID, page 3
THEATRE
Youth theatre presents ‘The Spell of Sleeping Beauty’
NI NEWS SERVICE
BRANDON BAKER/Northern Iowan
The Hudson Road pedestrian bridge near the Kamerick Art Building and McLeod Center is pictured. Construction began on the bridge this summer to improve its structure and the safety of its walking surface, which had prompted complaints in wet or icy weather. According to Doug Lovejoy of Facilities Planning, the construction should be finished in mid-August, before the start of the fall semester.
The Sturgis Youth Theatre will offer performances of “The Spell of Sleeping Beauty” at the Strayer-Wood Theatre July 19-22. Sturgis Youth Theatre, a theatre camp for kids, is a program of the University of Northern Iowa Department of Theatre. The summer production is put on entirely by students in the fourth grade and up, directed by UNI professor of theatre Gretta Berghammer. “The Spell of Sleeping Beauty” tells the story of tells the story of a princess, an unhappy royal fairy, a spinning wheel and a prince who saves the day. Performances are at 7 p.m., Thursday, July 19; 10:30 a.m. and 7 p.m., Friday, July 20; 2 p.m. and 7 p.m., Saturday, July 21; and 2 p.m., Sunday, July 22. Tickets are $7 and may be purchased by calling the Strayer-Wood Theatre box office at 319-273-6381 or online at www.vpaf.uni.edu/ unitix.