The House is expected to consider and vote on a bipartisan student loan deal that passed the Senate last week on an 81-18 vote. The deal ties interest rates to the rate on 10-year treasury bonds. The bill is intended to be a long-term solution and also a retroactive fix to July 1st of this year when loan rates doubled from 3.4% to 6.8%. The legislation will set interest rates this year at 3.86% for all new undergraduate Stafford loans, 5.4% for graduate Stafford loans, and 6.4% for PLUS loans. Caps for loans are set at 8.25% for undergraduate loans, 9.5% for graduate loans, and 10.5% for PLUS loans. While this means that undergraduate loan rates for the next couple of years will hover around a low 4%, there’s a potential that eventually rates could rise higher than they are now before they bump up against the caps.
The vote is set to take place this evening and is expected to pass.