5p.m. update U.S. Senator Jerry Moran (R-Kan.) released the following statement today regarding his support for the bipartisan student loan interest rate proposal. Negotiations have been ongoing in the Senate to reverse a hike on interest rates for new federally subsidized undergraduate student loans that went into effect July 1st. These subsidized undergraduate Stafford loans account for roughly 40 percent of all federal student loans.

“It is well past time for Congress and the President to pass a student loan policy that provides certainty and reflects the long-term financial planning students and families undertake to pay for higher education. Education is often a family’s most important investment and ought not be complicated by short-sighted Washington politics.

“In the interest of both students and taxpayers, I will support the bipartisan agreement in the Senate to permanently address interest rate levels for all federal student loans, and am pleased it appears it will be signed into law before many students return to school later this summer.”

 

3 p.m. update   (AP) — A bipartisan group of senators is announcing a deal that lets students dodge higher interest rates when they go back to campus this fall.

The group on Thursday told reporters they have reached a compromise that lowers the rates for all students who borrow from the federal government. The rates would be linked to financial markets, meaning interest rates would climb in coming years.

Democrats insisted on and won a cap on how rates could climb.

Democratic Sen. Dick Durbin of Illinois says the bill does not give any negotiator everything he sought. But it provides relief for students who were facing interest rates that doubled to 6.8 percent on new loans.

The House has already passed similar legislation and the differences could be resolved before students return to campus.

 

5: 10 a.m. (AP) — Senators are ready to offer students a better deal on their loans this fall, but future classes could see higher interest rates.
The Senate could vote as early as Thursday on a bipartisan compromise that heads off a costly increase for returning students. The compromise would be a relative deal for students through the 2015 academic year, but then interest rates are expected to climb above where they were when students left campus this spring.
Rates on some loans doubled on July 1 because Congress failed to reach an agreement.
Under the deal, rates would be linked to the financial markets. Rates would increase as the economy improves. Democrats demanded and won a cap on how high those rates could climb.