Student loan rate legislation approved in House

5:21 PM, Jul 31, 2013   |    comments
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PHILIP ELLIOTT, Associated Press

WASHINGTON (AP) - A bill that would lower the cost of student loans has passed the House and is heading to President Barack Obama for his signature.

The House on Wednesday gave final congressional approval to a bipartisan measure that links student loan interest rates to the financial markets. Most students would see lower interest rates in time for classes this fall.

Undergraduates this fall would borrow at a 3.9 percent interest 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. Rates would rise as the economy picks up.

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