Congressman's Plan Would Ease Student Loan Debt With Refinancing

SACRAMENTO (CBS13) — At least 40 million Americans are burdened by student loan debt with thousands more getting ready to graduate with a degree and a mountain of debt.

Rep. John Garamendi is proposing a bill that would ease the strain for students.

Whitney Menary is preparing for medical school and carrying a debt.

"Anywhere from 26,000 the highest 67,000," she said.

That's every year.

"I will have close to $200,000 in debt after graduating from med school if not more," she said.

Garamendi introduced a loan refinancing bill hoping to give students a break. Currently undergraduates have an interest rate of 4.29 percent, graduates have a 5.84 percent rate, and parents and post graduates have a 6.84 percent rate. All borrower rates would be lowered to 3.23 percent.

Garamendi says that means an Undergraduate student with average loan debt of $35,051 would save $2,760, and a Graduate student with average loan debt of $57,600 would save $3,480.

The federal government will make $138 billion profit off the backs of the students. It's a savings many students say would relieve debt stress now and in the future.

Garamendi says he is confident he can get this passed and is presenting it to colleagues next week. He hopes to have it in place later this year.