A group of bipartisan senators has reached a student loan deal that would lessen the interest rates on student loans till 2015.
Previously, US saw a lot of demonstrations from the students upon high interest rates on student loans. Their complaints were about high tuition costs and soaring interest on college loans which placed a lot of burden on many families.
Therefore the lawmakers met with president Barack Obama to discuss the issue at the Whitehouse. The deal is to offer lower interest rates to students through the year 2015. After that the rates could reach up to 8.25 percent for undergraduate students and 9.5 percent for graduate students and 10.5 percent of parents.
According to officials, this plan can save billions of dollars to 11 million families in the US. They are hoping to come to one agreement soon enough because families need to plan their finances well.
After a long and tiresome debate and weeks of arguments on this deal, the Senate finally approved the student loan deal with 81-18 votes. The liberal Democrats voted against this deal because they feared that this deal would make student loans even worse in the future. The agreement was reached but with a huge split between the democrats in the senate.
The bill goes something like this: 3.85 percent interest rate on all new undergraduate Stafford loans, 5.4 percent of graduate Stafford loans and 6.4 percent interest for parents and graduate students , this is actually for PLUS loans.
The Obama administration favors the deal but many senators including senator Elizabeth Warren voted against the bill. Her reasons for disapproval were: I cannot support a plan that asks tomorrows students to pay more in order to finance lower rates today. We should be doing everything we can to invest in students and offer them the best deal we can on student loans.