For example, most students at SIUC take out loans under the Federal Direct Stafford Loan program. This program has a 3 percent origination fee, which can add a few hundred dollars to a loan. Then, when repaying the loans, interest also becomes a factor. Under the Stafford Loan program, interest can climb to 8.25 percent, adding even more to the original loan, although it varies from year to year and person to person. Rick Steudel, assistant director of Financial Aid, is in accordance with the report.
Students do understate what they owe in loans.
But then we look at it item by item and they say, 'Oh, I guess that is right. Students are then required to pay off the loans. Depending on the payment plan chosen, it can take some students up to 30 years to repay their loans. According to the report, college leaders argue the current loan limits have not kept up with college costs. Students are then forced to take out loans from more expensive, private-label institutions driving them even further into debt.