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.
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Changing Fortunes for Student Loans

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Changing Fortunes for Student Loans

Changing Fortunes for Student Loans

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RENEE MONTAGNE, host:

Our business news begins with the changing fortunes of the student loan industry.

(Soundbite of music)

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. Yesterday, the nation's largest lender, Sallie Mae, said this legislation may scuttle its $25 billion buyout. The Senate will vote on a similar measure later this month.

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