August 12, 2013
On Friday a new law was enacted that is designed to fix student loan interest rates to the 10-year U.S. Treasury note. It will also establish interest rate ceilings and lock interest rates for the loan’s lifetime. In the process, interest rates will be slashed for the upcoming 2013-14 academic year, with undergraduate rates reduced from 6.8 percent to 3.86 percent.
The law will also retroactively apply to loans taken out after July 1, when interest rates on federal Stafford loans doubled.