"The compromise on student loan interest rates reached late last night is good news for students and families. On behalf of our 1,800 college and university members, representing all sectors of higher education, the American Council on Education strongly supports this agreement.
We support this plan for four reasons. First, it will immediately lower interest rates on federal student loans for all borrowers. Second, it will cap interest rates, protecting borrowers from dramatic increases in the future. Third, although rates will reset annually, students will always pay the rate at the time they borrow, providing predictability for their financial planning. Finally, by tying interest rates to the prevailing market rates, this agreement ensures students’ borrowing costs reflect broader economic conditions.
Federal student loans have become an essential ingredient in the financing of higher education for millions of students and families. The terms and conditions of these loans have a direct bearing on the ability of students to start and complete their education and on their financial well-being after they leave school.
We are pleased the Senate has reached a bipartisan agreement on this vital issue, and we urge swift passage."
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