The U.S. House of Representatives is taking preventative measures to protect student loans and is aiming to increase unsubsidized Stafford Loan annual limit by $2,000. Idaho Congressman Mike Simpson supported this important legislation to help stabilize student loans while the market is extremely variable.

H.R. 5715, the Ensuring Continued Access to Student Loans Act of 2008 is a bipartisan bill. It is designed to protect students and families by making sure the disruptions in the financial markets do not prevent students from pursuing their higher education goals.

"We live in uncertain times, especially now," said Simpson. "It is important that during this period of uncertainty, students are still able to make the choice to attend college. It is education that will keep our country moving forward and in order to maintain our place as the world leader, we must do all we can to help our young people succeed."

Beyond increasing the Stafford Loan limit, H.R. 5715 also provides of an optional grace period for PLUS Loans equal to that of a Stafford Loan. PLUS Loan borrowers would have the option to defer payment for six months after the student graduates from college.

This legislation is a pro-taxpayer solution that protects students and families without increasing federal spending. It permits the Secretary of Education to purchase loans, by creating a temporary backstop in a time of unprecedented market turmoil.

    This authority is in place for just one year, making clear that the long-term function of the loan 
    programs will not change.

    This authority is voluntary for both lenders and the Secretary. No lender is required to sell loans, 
    and the Secretary is not required to purchase them.

    This authority is cost neutral, requiring that the Secretary can only purchase loans if the result is 
    no net cost to the U.S. Government.

    This authority is flexible, recognizing that the best response is one that allows the Department of 
    Education to be nimble in response to students’ and families’ needs.

    This authority permits continuity for consumers by allowing the Secretary to maintain current 
    servicing, creating a seamless transition for borrowers.

H.R. 5715 passed the U.S. House of Representatives by a vote of 383-27 and will next be considered by the U.S. Senate.