Interest rates on new federal student loans to increase July 1 - WTOC-TV: Savannah, Beaufort, SC, News, Weather & Sports

Federal student loan rates set to increase July 1

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Since the U.S. Senate did not reach a deal or schedule a vote before Monday's deadline, rates on subsidized Stafford Loans will increase from 3.4 percent to 6.8 percent.

The Congressional Joint Economic Committee estimates this will cost the average student $2,600.

One very important detail to note, this does not impact current student loans. The new interest rates are only for new loans taken out starting July 1.

U.S. Sen. Johnny Isakson seems optimistic a deal will be reached by the time lawmakers come back from their holiday recess.

"Even though the threshold is triggered on Monday, the fact of the matter is it can be fixed pretty quickly, but we need to go ahead and adopt a permanent fix for the interest of our students and their future."

Lawmakers get back to work on July 8.

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