House Passes Student Loan Bill to Ease Credit Limits

The U.S. House of Representatives Thursday approved a measure designed to ensure availability of credit for student loans, 388-21. The measure, which had already passed in the Senate, now goes to President Bush, who is expected to sign it.

“By granting the Department of Education greater authority to purchase federal student loans, today’s action should ease the anxiety many students may feel about their ability to finance their education this fall,” Bush said in a prepared statement.

The legislation raises the limits on how much borrowers can receive in student loans and is essentially the same one that the House passed last month (“U.S. House Rides to Rescue Debt-Laden Students,” April 18), with a couple of minor changes the Senate made.

By increasing the loan limits, the legislation takes some of the pressure off the student credit market, which has been hit hard recently by the end of several private lending programs, (“Student Loans Drying Up, Dodd Warns,” April 16), as well as the reduction of lenders in the federal loan program (“Mike’s Take: The Challenge for Student Loan Collections: Thoughts from NCHELP,” April 11).

The measure also enables parents to defer repayments for loans for their college student children until after the students leave college.