GOP and Democrat Senators have joined to make student loan interest rates lower until the end of the 2015 academic year, with a subsequent rise in the interest rates. The vote to confirm the deal will be either July 18 or the following week.
The rates doubled on new subsidized Stafford loans on July 1 from 3.4 percent to 6.8 percent.
The agreement would keep loans for undergraduates this fall at 3.85 percent, graduate students’ rates would be 5.4 percent, and parents could obtain loans at 6.4 percent.
The rates after the 2015 academic year would rise to 8.25 percent for undergraduates, 9.5 percent for graduate students, and 10.5 percent for parents.
Sen. Lamar Alexander (R-TN), told Politico that students who already have loans at higher rates would be able to use the new deal: “It would save students in 11 million families billions of dollars,” he said. “We’d like to be able to do this together and we hope that we can come to a decision right away because families need to make their plans.”
Alexander and Sen. Dick Durbin (D-IL), reportedly mediated the deal struck by Democrat Sen. Joe Manchin of West Virginia and Republican Sen. Richard Burr of North Carolina.