66% oppose student loan interest hike

July 08, 2013, 2:40 PM GMT+0

Two-thirds of Americans oppose the recent interest rate hike on loans for low-income students

This summer, Congress failed to pass an extension of a law capping interest rates on federal loans for low-income students - commonly known as subsidized Stafford loans. They had been 3.4%, but rates doubled to 6.8% on July 1st. Few Congressional leaders support this change but they were unable to agree on a long-term plan for college interest rates, prompting this change. President Obama and Republicans are keen to tie interest rates to the amount federal borrowing costs, but they were unable to reach a consensus or win enough votes among House Democrats - who generally support the current system of fixed interest rates.

The latest YouGov research shows that a large majority of Americans believe that Congress should have extended the low interest rates for subsidized Stafford loans, with only 66% believing that the low rates should not have been extended. Every demographic group has a majority who oppose the interest rate hike, though Democrats are generally more opposed to the change than Independents or Republicans.

This partisan split becomes more apparent when people are asked whether they think that the federal government currently does too much or too little to help students. The most common response (60%) among Democrats is that the federal government currently does too little. Among Republicans, 35% say that the federal government does too much, closely followed by the 30% who are happy with the current levels of support.

As for how the federal government should be helping students, providing affordable loans to is the most popular way, with 56% of people saying that the government should be doing this. 42% also support giving cash grants to low-income students, while 37% support providing incentives for private companies to lend to students. Only 12% do not support any of these measures.

Interestingly, when asked specifically on whether the government should play a role in helping students receive loans, people who have 4-year degree (though not a post-graduate degree) are the most likely (39%) to say that it is not the government's role. Nevertheless, even among this group 48% support the government playing some role in increasing access to student loans.