Senators Reach Deal to Lower Student Loan Rates in Fall; Vote May Be Thursday

July 17, 2013
Detroit Free Press  
student loan news

A bipartisan group of senators hammered out a deal this week that would offer students better rates in the short term but may assign higher rates in later years. Lower interest rates would persist through the 2015 academic year, then climb higher as they are linked to financial markets. Rates would be capped at 8.25 percent, however, for undergraduates; at 9.5 percent for graduate students; and at 10.5 percent for parents. This could be the final agreement in ongoing efforts to roll back a July 1 rate hike for subsidized Stafford loans that doubled the rates from 3.4 percent to 6.8 percent, adding about $2,600 to students’ education costs. The Consumer Financial Protection Bureau projected that Americans now owe more than $1 trillion in federal student loan debt, noting that this form of debt is growing faster than credit card debt. The U.S. government could make $50 billion this year off student loans, an estimate that could increase by as much as $21 billion if no deal is made to reduce interest rates on Stafford Loans.
Web Link

Abstract News © Copyright 2008-2013 INFORMATION, INC.
Powered by Information, Inc.

Stay Updated

Join the fight against predatory lending. Enter your e-mail to sign up for breaking news, action alerts, and CRL's original research.

   Please leave this field empty

Help Us End Predatory Lending

Predatory lending destroys family wealth, and preys on our most vulnerable communities. You can help us end abusive lending practices by donating to CRL, or by sharing our work with others.