Treasury sets student loan interest rates near historic lows

The U.S. Treasury Department set federal student loan interest rates at 4.45 percent, which is down from a peak of 6.8 percent in 2012.

The Bipartisan Student Loan Certainty Act of 2013, sponsored by Sens. Richard Burr (R-NC), Angus King
(I-ME), and Joe Manchin (D-WV), paved the way for student borrowers to take advantage of lower interest rates. The law, which went into effect in 2013, has saved students and families $58 billion, according to the bill’s sponsors.

“This is a true victory of bipartisanship,” Burr said. “The old system of letting Congress legislate student loan interest rates wasn’t working; it was causing uncertainty and it was costing young people a lot of money. I was proud to work with Senators King and Manchin on a plan to tie student loan interest rates to the market.”

King said students should have more money to investing in their future instead of being buried under a mountain of debt.

“The student loan deal we struck back in 2013 demonstrates what legislating and compromise looks like, and I hope this Congress will look to it as an example of the good we can do for the American people when we put politics aside and work on their behalf,” King said.

Manchin called it a win for students and bipartisanship.

“I was proud to come together to pass a commonsense, long-term fix that lowered interest rates on federal student loans,” Manchin said. “This legislation lowered costs for students and provided them with the opportunity to help lead America to a better future for generations to come.”