Changing Fortunes for Student Loans

The House voted to slash $19 billion in federal subsidies to student lenders. Democratic backers say it will help students pay for college without building up huge debts. The bill increases grants for needy students and halves interest rates on federally backed loans. The student loan industry lobbied fiercely against the bill, which the White House threatened to veto. The largest U.S. lender, Sallie Mae, says this legislation may scuttle its $25 billion buyout. The Senate will vote on a similar measure later this month.



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