Student Loan Bill Passes House; Awaits President Obama's Signature

By: Bailey Myers Email
By: Bailey Myers Email

By: Bailey Myers
July 31st, 2013

Tallahassee FL- Higher Education students are getting some help when it comes to loan interest rates. A bill lowering them is now on its way to President Obama.

The bill links student loan interest rates to the financial markets. It means student loans for the next few years would lower. Higher rates could come however, if the economy continues to improve.

FSU Ph. D Candidate, Brent Davis, says he's cautious, "Especially since the earning potential from recent graduates is a lot lower having a higher interest rate will really hinder them from doing other things like buying a car or being able to get a mortgage."

Loans for undergrads would be a 3.9%. As for grad students-- the interest rate would be at 5.4%. Those rates would be locked in for the year.

Associated Press Release

WASHINGTON (AP) -- At least for the coming school year, a bipartisan bill passed by the House will lower the cost of borrowing for millions of students.

The measure, which passed on a vote of 392-31, awaits the signature of President Barack Obama.

Undegraduates this fall will borrow at a 3.9 percent increase rate for subsidized and unsubsidized loans. Graduate students would have access to loans at 5.4 percent, and parents would borrow at 6.4 percent.

The rates would be locked in for that year's loan, but each year's loan could be more expensive than the last. That's because interest rates will be linked to the financial markets. That means the rates will climb as the economy improves.

Interest rates would not top 8.25 percent for undergraduates. The White House endorsed the deal over objections from consumer advocates that the proposal could cost future students.

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