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How the Bipartisan Student Loan Certainty Act Would Help Borrowers

How the Bipartisan Student Loan Certainty Act Would Help Borrowers

Currently up for a vote in the Senate, the bill would provide student-loan borrowers with a reasonable interest rate that does not change over the life of the loan.

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This week the Senate will vote on the Bipartisan Student Loan Certainty Act, a bill written by Sen. Tom Harkin (D-IA), chairman of the Senate Health, Education, Labor and Pensions, or HELP, Committee. Sen. Harkin worked with Sens. Dick Durbin (D-IL), Joe Manchin (D-WV), Tom Carper (D-DE), Lamar Alexander (R-TN), Richard Burr (R-NC), Angus King (I-ME), and Tom Coburn (R-OK) to develop this bipartisan compromise, which would lower interest rates for the 11 million student-loan borrowers who either have taken out or will take out a new federal student loan after July 1, 2013.

Under the bill, interest rates in 2013 would be reduced immediately for all borrowers. The rates for undergraduate students and graduate students would drop to 3.86 percent and 5.4 percent, respectively, down from the current rate of 6.8 percent. The rate for parents and graduate students getting PLUS loans would also drop to 6.4 percent, down from the current 7.9 percent.

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