Can somebody tell me what's going on with this news article or maybe summarize it? please?
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House and Senate negotiators reached a compromise late Wednesday on a bill that makes sweeping changes to the federal government's college financial aid programs.
The bill cuts the interest rate students pay on subsidized Stafford loans by half over four years and increases the maximum Pell grant for needy students.
Under a new program, starting in 2009 borrowers won't have to devote more than 15 percent of their discretionary income to student-loan repayments, although any unpaid amounts will be added to the loan balance in most cases.
The bill also establishes a tuition-assistance program for students who commit to teaching high-need subjects in low-income public schools and a loan-forgiveness program for other public-sector workers.
Congress intends to pay for these and other programs by cutting the subsidies it pays to private-sector lenders who make federally guaranteed Stafford and Plus loans by $20.9 billion over five years.
Lenders have said these cutbacks will force them to curb benefits they have been offering, such as waiving or discounting origination fees and reducing interest rates for borrowers who make on-time payments for three or four years. Very few borrowers qualify for the interest-rate cuts and they're not offered to students at all schools.
The bill, HR2669, incorporates provisions of bills passed earlier by the House and Senate and has been renamed the College Cost Reduction and Access Act. The compromise bill now goes back to the House and Senate for approval and then to President Bush. While Bush has endorsed most aspects of the bill, his administration has opposed certain provisions, such as reducing Stafford loan rates.
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