WASHINGTON - A coalition of lawmakers including Sen. Joe Manchin of West Virginia today will introduce a bill to prevent an increase of student loan rates.
The Bipartisan Student Loan Certainty Act will prevent loan rates from doubling on Monday and provide a permanent solution to lower and fix interest rates for all newly issued student loans, Manchin said.
"This bipartisan agreement not only makes sure student rates will not double on (Monday,) but this is a long-term fix that will lower rates for all students and will save students $30 billion over the next three years, making sure anyone who wants an education, can afford one," he said. "This deal shows the American people that bipartisanship and common sense are alive in Washington. We can find common ground to help our students and ensure the next generations of Americans have the same wonderful educational opportunities that we have always had."
The legislation was developed by Manchin and Sens. Richard Burr, R-N.C., Tom Coburn, R-Okla., Lamar Alexander, R-Tenn., and Angus King, I-Maine.
"Our solution successfully builds on the many credible proposals put forward by members on both sides of the aisle, as well as the president, to help make college an affordable reality, King said.
Under the act, for each academic year, all newly-issued student loans be set to the U.S. Treasury 10-year borrowing rate plus 1.85 percent for subsidized and unsubsidized undergraduate Stafford loans, plus 3.4 percent for graduate Stafford loans and plus 4.4 percent for P.L.U.S. loans.
The interest rate would be fixed over the life of the loan and the cap on interest rates for consolidated loans would remain at 8.25 percent.
The Congressional Budget Office has determined this legislation would reduce the deficit by $1 billion over 10 years.