Updated 10/07/2008 07:06 PM
Despite crisis, student loans stable
RALEIGH -- Officials in North Carolina hope the credit crunch doesn't prevent college students from getting loans.
This summer, Congress passed a bill to improve student loan availability. The move helped lower interest rates on loans from 6.8 to 3.4 percent.
And although the country is in a credit crisis, North Carolina financial leaders said student loan availability should be stable.
But still, N.C. State junior Christopher Fench said the thought of the crisis is still overwhelming.
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"I think it's hard to fathom how it affects us all," he said.
And lawmakers are worried the financial crisis could dry up student loan programs.
New York Sen. Charles Schumer is urging Treasury Secretary Hank Paulson and Federal Reserve Chairman Ben Bernanke to pay attention to the student loan market as they begin to implement the financial bailout plan.
The Democrat says a tighter credit market could force students or their families to pay higher interest rates on loans, or keep them from qualifying at all.
But the College Foundation of North Carolina said for now, that's not the case in our state.
As North Carolina's largest nonprofit lender for federally subsidized loans, the group believes college students here shouldn't worry about having money for college.
"We're lucky there's money available for people who would like to go to college right now. There's about $300 million in need-based scholarships and grants available. We do have loan money available as well, low-cost federal loan money available," said College Foundation spokesperson Ben Kittner.
Nearly half of all public and private student-aid money across the U.S. comes from the Federal Student Loan program.
About 83,000 college students in North Carolina use federal money for student loans.
The College Foundation said the request for those loans will only increase.
"Right now they will be available, there's no problem in North Carolina right now. I think we have to just see where the market goes over the next year or so as far as where the next influx of money will come from," Kittner said.
Students in North Carolina have an average of $14,000 in federal aid money. That's $5,000 below the national average.