The deadline is fast-approaching to keep federal student loan interest rates from doubling on Monday, July 1. Unless Congress completes its homework, Federal Stafford Loans—low-interest financial assistance that allows recipients to defer payments until after they've finished school—will jump to 6.8 percent for approximately 7.4 million university students.
One bit of compromise appears to be a last-ditch proposal from a bipartisan group—three Republicans, one Democrat and one Independent—that would fix all new student loans to the 10-year U.S. Treasury bond rate, plus 1.85 percentage points. Graduate student loans would be 3.4 percentage points above the 10-year rate.
Another effort from a larger Democratic contingent would freeze the 3.4 percent rate for one year while lawmakers try to iron out a long-term agreement. But even the bill's authors say the proposal probably won't get a vote before Congress leaves for the weeklong Fourth of July break.
Most university students don't sign loan documents until early August.