student loans

A bill that would have let millions of people refinance their student loans at a lower interest rate has failed in the Senate, after Republicans objected that it included a tax on the wealthy to pay for it. The measure would have allowed people with older loans to benefit from today's low interest rates.

The bill from Sen. Elizabeth Warren, D-Mass., didn't get past a procedural vote, falling by a 56-38 vote. Called the Bank on Students Emergency Loan Refinancing Act, it was shot down days after President Obama urged Congress to help ease the burden of student debt.

(This post was updated at 3:24 p.m. ET.)

President Obama signed an order on Monday that expands the number of Americans whose student loan payments will be capped at 10 percent of their monthly incomes.

CNN reports the new order would allow an additional 5 million borrowers to take advantage of the cap beginning in December 2015.

Bloomberg adds:

Saying a college education is the "surest path to the middle class," President Obama announced a plan Thursday to allocate federal aid to colleges and universities based in part on their affordability.

U.S. Senators failed Wednesday to pass legislation to extend lower interest rates on federally-backed student loans. Republicans banded together to block the bill. But they have their own plan.

Interest rates of federally subsidized student loans have doubled to 6.8 percent. But there’s time for the rates to be reduced before students begin receiving their loans in late August.


Students planning to borrow money from the federal government to pay for college will now pay 6.8 percent interest on their Stafford student loans.

Today, UT System Chancellor Francisco G. Cigarroa expressed his disappointment with the increase, which effectively doubled the percentage of interest rates on student loans. 

KUT News

There could be test votes this week in the U.S. Senate in the latest showdown over student loan rates. Interest rates on federally-backed student loans are set to double on July 1.

It’s the same situation as a year ago when the scheduled rate increase was delayed for a year.