WASHINGTON (May 16, 2013)—The U.S. House Education and Workforce Committee Thursday approved a bill to link interest rates on college loans to financial markets, sending the measure to the full House.
Democrats stood unified against the measure.
Without congressional action, interest rates for new subsidized Stafford student loans will double from 3.4 percent to 6.8 percent on July 1.
The Democrats' attempt to hold them there failed on a party-line vote.
Under the GOP proposal, the interest rates would be linked to 10-year Treasury notes.
The Congressional Research Service predicts that means higher rates but the Republican chairman of the education committee, Rep. John Kline, says no one really knows what interest rates will be.