President Barack Obama is coming to North Carolina. Tuesday, he'll be at the University of North Carolina Chapel Hill talking about the anticipated increase in tuition loan interest rates. This July, they'll go up from 3.4 percent to 6.8 percent.
The Director of Financial Aid at Winston-Salem State University says this is the federal government's attempt to avoid reducing the value of Pell Grants. "There's been talk about cutting Pell for a number of years - taking it down to $4,700 from its current rate of $5,550 a year as a maximum award. So the federal government is trying to find a way to protect the Pell Grant program while still allowing students to borrow loans." The increase will not result in an all-time high interest rate.
The loan interest rate increase means students will pay an additional $400 annually. This does not include health insurance.
For the 2011-2012 academic year, the average total cost of full-time undergraduate student is $20,660 for North Carolina residents and $41,140 for out-of-state residents. The increase affects students attending at least 15 of the state’s public colleges.
Pell grants are only awarded to undergraduate students.
President Obama will speak at UNC's Carmichael Arena at 1 p.m. on Tuesday. He will also visit other colleges in Colorado and Iowa to speak about the same topic. These are states Obama won in 2008 but are expected to be closely contested during the 2012 Presidential race.
