Senator Rounds' bill would create more education funding opportunities

SIOUX FALLS, S.D. (KELO) -- It's meant to give students and parents another option if they can't qualify for federal student loans. Since 2010, the Department of Education has issued all federal student loans. However, a new bill introduced by Senator Mike Rounds would add to the current system. If approved by Congress and the President, the Affordable Future Loan Program would work with banks and credit unions.

"What we looked at was going back to what used to work for a whole lot of people out there," said Rounds. "Which was a guaranteed student loan, but run it through your local institution, a bank or credit union, and the federal government would guarantee 98 percent of that loan. So it is easy for the bank or credit union to make the loan."

Under the plan, the government would guarantee the loans and pay the interest while the student is in school. 6 months after graduating, the student would start repaying the loan over 15 years. Rounds says the need was pointed out by South Dakotans who are not able to qualify for subsidized loans. This ...