This translation is not completely accurate as it was automatically generated by a computer.
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A UMNS Report
By Kathy L. Gilbert*
2:30 P.M. ET June 27, 2012
Congress voted to extend low interest rate of Stafford loans for another year.
A web-only photo by David Franklin/iStockphoto.
Conor McCandless, 18, is “wired for engineering or math” and he just
started at Colorado School of Mines. At the moment he wants to be a
chemical/biochemical engineer.
He has no idea now how much debt he will incur getting to his goals and
even though the U.S. Congress made a last-minute move to keep Stafford
loan interest rates from doubling, he is likely looking at more than
$50,000 in student loans to follow him on graduation day.
McCandless is just one of many college students who are partly financing
their college degrees with a federal Stafford loan. For weeks, Congress
delayed a plan to keep the federally backed loan program interest rate
at 3.4 percent. A measure capping the rates for another year passed and was signed by President Obama on June 29, however the bill will have to be renewed again in 2013.
The McCandless family is doing what most families do: They are
borrowing from a couple of loan sources and using what they have saved
to send their son to the school he wants to attend.
“I am a teacher and my husband is a police officer. We are
definitely not the people who qualify for financial aid but do not have
hundreds of thousands saved for college,” said Tracy McCandless.
Maggie McCandless, 16, would like to go to medical school when she
graduates in a couple of years, but the reality of how much that will
cost will probably keep her from pursuing that dream.
“We just tell Maggie to relax. If she continues to get straight As,
she will have a good shot at a scholarship somewhere,” Tracy
McCandless said. “Our kids are the ones who will be paying for college
for many years after they graduate.”
Sobering reality
Kayla Ferguson, a recent graduate from Pepperdine University, said
her looming debt is “very sobering” even though she received more than
$35,000 in scholarships.
“I will also say that I do not regret attending a university that
caused my fairly substantial amount of student loans. The people I met,
experiences I had, and skills I gained should, in my mind, adequately
prepare me for a career after college that will allow me to pay back my
student loans without a problem,” she said. “The reward of college far
outweighs the stress of paying them back … at least for now!”
Heavy burden
“There
is grave concern about the amount of student loan debt students are
incurring, especially for those students who do not graduate.”
— Eric King, financial director for Wiley College
The Federal Reserve Bank of New York estimates student loan debts
now exceed credit cards and auto loans and more than 37 million
Americans owe $870 billion in student loans.
That fact is always on the mind of Eric King, financial director for Wiley College in Marshall, Texas.
“There is grave concern about the amount of student loan debt
students are incurring, especially for those students who do not
graduate,” he said. “Students who graduate and find a job in their
field find it difficult to repay student loans. Students who do not
graduate find it impossible to repay their student loans and this
results in default.”
Wiley is one of the 11 historically black universities
related to The United Methodist Church. The denomination has 120
related and owned institutions in the United States, and the
denomination also offers loans and scholarships for United Methodist students.
Schools need students to enroll so sometimes it might not be to the
college’s advantage to warn students about debt, said Alison Rabil,
assistant vice provost and director of financial aid at Duke University, one of the largest universities related to The United Methodist Church.
“That is not the case, thankfully, at Duke but it is in large part
what has contributed to this large debt problem. Couple that with a
generation of parents who have managed their finances using more credit
than any other before them, have not saved substantially, own homes
they can’t afford and therefore have less to spend on their children’s
educational expenses, and you have our current debt crisis,” Rabil
said.
The United Methodist Church also has a special Sunday each year — United Methodist Student Day —
for congregations to donate to scholarships. The fund was established
in 1866 for the advanced education of Sunday school children and the
educational preparation of people for the ministry and missionary
service.
The 1940 General Conference established Methodist Student Day with a
churchwide offering. The 1968 Uniting Conference continued this
connectional student-aid program to be funded by the United Methodist
Student Day offering. Dates for taking the offering have changed
through the years.
In 2012 United Methodist Student Day will be observed on Nov. 25.
Faith decisions
Deontez Wimbley, 19, is a sophomore at Claflin University
in Orangeburg, S.C., pursuing a double major in religion and
sociology. He plans to become an ordained minister in The United
Methodist Church.
He financed his first year of college with a combination of
institutional aid, Pell grant, work study and unsubsidized loans. “All
together I took out close to $10,000 in loans for just one year,” he
said.
Tuition at this historically black United Methodist-related school
increased 7 percent over last year, putting his next year of college at
around $25,000. His call to ministry means going to a seminary, which
he knows will add to the financial burden.
“I do often wonder how loans will affect me in the future. As a way
of decreasing them I volunteer with AmeriCorps teaching middle school
students literacy and writing, giving over 400 hours of community
service a year,” he said.
AmeriCorps accounts for about $1,500; four years of service will help Wimbley pay back $6,000.
Michael McCall, 23, plans to go to law school after he gets his
undergraduate degree from Middle Tennessee State University. The cost
of law school will be more of a deciding factor than which university
he would really like to attend.
Already his debt is close to $50,000.
“I will probably be paying for college for a long time,” he said.
* Gilbert is a multimedia reporter for the young adult content team at United Methodist Communications, Nashville, Tenn.
News media contact: Kathy L. Gilbert, Nashville, Tenn., (615) 742-5470 or newsdesk@umcom.org.
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