Courtney Statement on House Passage of Bipartisan Student Loan Interest Rate Compromise

WASHINGTON—Today, Congressman Joe Courtney (CT-2) released the following statement after the House of Representatives approved the Bipartisan Student Loan Certainty Act of 2013 by a vote of 392 to 31. Prior to the vote, Courtney spoke on the floor of the House in support of the bill.

“After months of negotiations, Congress has finally united to approve a bipartisan bill that will have an immediate benefit for students and families. Interest rates on federal student loans automatically doubled on July 1st, from 3.4 percent to 6.8 percent, a hike that would have left students responsible for paying nearly $1,500 more in interest over the life of the loan. At a time when student loan debt has surpassed credit card debt, and rates on other types of consumer loans, including mortgages, are well below 6.8 percent, this rate hike made no sense for middle class families.

“This compromise, like any compromise, is not perfect – but it is a significant improvement over current rates and the Republican proposal that the House passed on May 23rd. That bill would have subjected students to unpredictable rates that would reset annually throughout the life of the loan and cost Connecticut students and their families more. That reckless proposal would have been a worse deal for students than simply keeping the rates at 6.8 percent. However, I am glad that cooler heads prevailed, allowing us to pass this compromise bill that will provide immediate relief for borrowers.

“With the passage of this measure, undergraduate students and families who are getting ready to head back to school in just a few weeks will have interest rates on their Stafford student loans reduced from 6.8 percent to 3.86 percent, saving them nearly $1,500 in interest over the life of the loan. This bipartisan compromise reduces student loan interest rates immediately and in the near term, acting as a bridge to the reauthorization of the Higher Education Act, in which we can address college affordability comprehensively. Unless we can begin to rein in the cost of college, lower interest rates will not be sufficient to make higher education affordable for middle class families.”

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