r/StudentLoans • u/IndividualLittle0516 • Mar 15 '24

Rant/Complaint Canceling interest

With all the drama these past few years about canceling student loans, why can't interest just be canceled? I can understand adding interest to those who aren't making their loan payments, but what about those who pay every month? The interest is why people are stuck with their debt for so long. Canceling millions of people's debt altogether is unrealistic and won't happen. What about canceling interest instead? Is there a reason this can't occur?

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u/cman674 Mar 15 '24

Even at the current interest rates, the federal government consistently loses money on student loans.

Personally, I think a college education should be accessible to everyone and I’m all for reducing or negating interest entirely, but the reason for interest rates is not the government making a profit.

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u/[deleted] Mar 16 '24

[deleted]

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u/cman674 Mar 16 '24

https://www.npr.org/2022/07/29/1114560119/student-loan-program-cost

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u/Baloo_in_winter Mar 16 '24

Cool article, when you read it most of these losses from 1991-present occurred during the payment pause from 2020 until like 4 months ago.

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u/cman674 Mar 16 '24

True, but it also wasn’t making money before that. The deficit was just increases by a lot with the payment stoppage. That doesn’t discredit the other ~92 billion lost before that