Interest rate could double on some student loans

College will get costlier for millions of low- and middle-income student loan recipients starting next autumn, unless Congress intervenes, writes Raju Chebium for USA Today. The fixed interest rate on Stafford federal subsidised loans, held by nearly eight million undergraduates, is set to double on 1 July.

President Barack Obama has asked Congress to block the rate hike for current and future Stafford loan recipients, but legislation aimed at keeping it permanently at 3.4% has stalled in Congress. Obama's 2013 fiscal budget would freeze the interest rate at 3.4% for a year.

Advocates aren't sure if there's enough support in Congress to prevent the interest rate from doubling to 6.8%. If the rate does double, recipients would pay an extra $5,000 over 10 years if they were to borrow the maximum $23,000, said Rich Williams, a higher education policy analyst at the US Public Interest Research Group.
Full report on the USA Today site