House Passes Bill, Linking Student Loan Interest Rates To The Financial Markets, Bill Headed To President’s Desk

After a long battle between the White House and Congress, a measure that links student loan interest rates to financial markets has passed the House, in a 392-31 vote. The compromising legislation is being sent to the president, who is expected to sign it into law.

The move will temporarily bring the student loan rates down after doubling to 6.8 percent on July 1. Under the new bill, the rate will be reduced to 4.6 percent.

Critics have said this deal could cause student loan interest rate to increase every year as the economy strengthens.

The approval of the bill follow the Senate’s compromised bill that caps interest rates at no more than 8.25% for undergrads, 9.5 percent for graduates and 10.5 percent for the parents.  The Senate’s deal was attained despite objections from several Senate Democrats that said tying the two together could cause unfair high rates even if there is a cap.

The bill’s earlier version, before changes occurred in the Senate, passed the House with a 221-198 vote.

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Posted by on Aug 1 2013. Filed under Finance, New. You can follow any responses to this entry through the RSS 2.0. Both comments and pings are currently closed.

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