Interest Rates on Student Loans to Potentially Double - WLNS TV 6 Lansing - Jackson | Your Local News Leader

In less than one week, the interest rate on student loans could double to nearly 7 percent if Congress doesn't take action.

When Hayley Digianni graduates from MSU in 2016, she'll have more than $120,000 dollars in student loan debt.

"You really want to get your education and it's so important. [But] it's almost like a punishment to have to pay more for it," Digianni said.

Which is exactly what will happen if Congress doesn't act to stop interest rates from doubling to 6.8 percent from 3.4 percent on federally subsidized stafford loans.

"It's not something people should be excited about, doubling interest rates kinda just is horrible," she said.

"Just in the state of Michigan alone, it's expected that this will impact about 300,000 student loan borrowers, and on average, it will impact them about a thousand dollars over the lifetime of their loan," said Evan Montague, the Dean of Student Services at Lansing Community College.

Students in Michigan graduate on average with about $25,000 of loan debt.

On a 10 year plan at 3.4 percent, the grand repayment total would be $26,525.32.

At 6.8 percent, that same $25,000 would end up costing $34,524.14.

A difference big enough to make students think twice about how much they choose to take out.

"Try to keep borrowing to a minimum, borrow wisely and think about your goals," said Montague.