“A long-term fix to prevent an increase in student loan interest rates is vitally important for America’s young people,” Coats said. “I have supported a market-based proposal, similar to what President Obama has suggested, that would allow students to take advantage of low interest rates and provide long-term financial stability to the loan program. The Senate Majority Leader rejected this common-sense proposal in order to push for tax increases. This misguided plan would cost taxpayers more than $8 billion, yet would save students only $6 per month. Given the economic challenges already facing young Americans, I am hopeful that Senator Reid will work with the president and Republicans on a permanent solution that puts students ahead of politics.”
Beginning in July, the interest rate on new subsidized Stafford student loans increased from 3.4 percent to 6.8 percent. Approximately seven million college students will be affected by the rate hike.