A struggling economy, shrinking endowments, turmoil in the student loan marketplace, and state budget cuts have all raised questions about students' continued ability to pay for school. However, despite economic troubles, at least one state has plans to launch a new program to help its students find money for college in the form of low-interest student loans.
Connecticut students will soon have one more source of student financial aid, thanks to a new partnership between the state and its credit unions. The loan program, announced yesterday by the governor's office, would provide up to $17.5 million in student loans for college students from Connecticut and students attending college in the state.
Connecticut Governor M. Jodi Rell met with officials from the state's credit unions on Tuesday to discuss the partnership. Under the proposed college loan program, students would borrow directly from the credit unions at interest rates of 5.75 or 6 percent. Each credit union would be required to offer at least $100,000 in student loans to participate in the program. The loans are designed to help families who don't have access to sufficient amounts of financial aid, such as federal Stafford loans, to cover their tuition bills. The governor's press release did not make mention of borrowing limits or requirements.