Stafford Loan Interest Rates Rise, ADA Lobbies for Bill to Allow Students to Consolidate Loans
July 14, 2014
Interest rates on federally subsidized Stafford loans for graduate students recently went from 5.41 to 6.21 percent. These rates are set for the academic year every July 1 and are effective through June 30 of the following year.
Congress last year changed the way the rates are set, basing them on the interest rate earned by the 10-year Treasury note, and a fixed percentage depending on the type of loan. Unlike with loans with private lenders, these loan rates are fixed for the life of the loan.
In May, the ADA asked Congress to pass S. 1066, a bill that would allow dental students to consolidate their federally subsidized educational loans (just as they can with private loans) at a fixed rate of 4 percent.
The legislation, introduced May 23 by Sen. Kirsten Gillibrand (D-N.Y.), has 10 cosponsors and currently awaits consideration in the Senate Health, Education, Labor, and Pensions Committee.