Snap Reactions to New Federal Student Loan Rates

STUDENT LOAN RATES SET TO DOUBLE ON JULY 1ST. The interest rate on government-backed student loans is going to jump from 3.4 percent to 6.8 percent Monday. —NPR, June 28, 2013

1. o no o no

2. i’m still behind by $150 worth of payments

3. just for fun whats 6.8 percent of 150 oh i don’t even know how to calculate that
like 12 bucks?
great there goes another pack of Sally Hansen nail decals

4. it really doesn’t seem very fair

5. these are supposed to be more affordable than private loans but my private loan is at 9% and 6.8 is not that far from 9

6. i can’t stop singing that sheena easton song “my baby takes the morrrrrrrnin train!”

7. if my entire government loan is $40,000 (hahah ugh fuck) whats 6.8 percent of that come on lauren you can do this

8. i honestly have no idea how to calculate what that would be

9. god i’m dumb i honestly hate math

10. “he works from 9 to 5 and then he takes another home again”

11. 40 thousand dollars times 6 point eight percent

12. is it 40,000 X 0.068?

13. i literally took AP calculus and fucking figured out the area of a curve on a plane, which DIDN’T EXIST, and i can’t figure out this shit?

14. oh is it only for new loans?

15. no i thought it was for all loans

16. oh ok great well forget it

17. “my baby takes the morning train”


Lauren Rodrigue lives in New York.


21 Comments / Post A Comment

sea ermine (#122)

Haven’t they been 6.8% for a while? I have some loans already that are 6.8% and some that are smaller. Or is this a subsidized vs unsubsidized thing (I have both).

sunflowernut (#1,638)

@seaermine My subsidized loans are 6% and my unsubsidized loans are 6.8%. Who was getting the 3.4% ones? I thought that was just a long time ago? Got all my loans between 2007-2010.

sea ermine (#122)

@seaermine My loans were between 2008-2012. I have 4 loans and I think 2 of them are 3.4 or something between 3-5% and two are 6.8%. Half of mine are subsidized and half are unsubsidized (I think). I’m not sure what determines the interest rates though.

annecara (#1,914)

@sunflowernut Yeah, same here; I think I started with four 6.8% loans, one 6%, and one that’s like 2.5% or something.

redspectacles (#3,428)

“…to find me waiting for him!”

LookUponMyWorks (#2,616)

I’ve been following the stuff about student loan rates going up for a while and I’m still confused: I’m a few years post-grad and my loans are consolidated and some of my loans are at 5.2% and some are at 6.8%. Are my interest rates still going to double? Or is this just for people who will be taking out loans after July 1st?

Mike Dang (#2)

@LookUponMyWorks Rates on existing loans should remain the same. If you’ve consolidated federal student loans, you’ve essentially locked in a rate for the remainder of your repayment period.

aardvark (#3,451)

@LookUponMyWorks The interest rate adjustment only affects new loans–it’s going back up to the same rate that it was for loans disbursed in 2006-07.

Interest rates for student loans are generally based on when the loan was disbursed. So, whatever the rules were when you first got your loan determine the interest. If you consolidated, I’d guess that you are either at a fixed or variable rate. Anything at a fixed rate shouldn’t change ever as it is fixed, anything at a variable rate will adjust based on a particular rule, generally.

How the pre-July-2006 variable rate is calculated:
Last year bonds were apparently trading slightly higher, so interest rates on variable FFEL/Plus/some really ancient consolidation loans are going to be minutely smaller this year. Yay for us olds!

I have no idea what your particular situation is, and this only applies to federal loans. If you have private loans with variable interest rates, it’s probably tied to some index. Sallie Mae uses the prime rate or another index depending on the loan.

(This link lists the interest rates for everything that disbursed between 1998 and 2012:

la_di_da (#1,425)

There’s a possibility that they’ll take it back down retroactively, but barring that…yeah we’re fucked. Thanks Congress.

CubeRootOfPi (#1,098)

I thought it only applies to current students, not those currently in repayment/graduated? Still sucks, though.

Christy (#3,892)

Yeah, some of us already had to take out loans at 6.8% in 2009 and 2010. It was nice that they halved it for you, but it’s not some SHOCKING NEW PROBLEM.

Sorry, I’m bitter that others got loans at 3.4%. I’m working on it.

@Christy You and me both. I am also bitter that some people got subsidized loans. I’m not really working on it; I just sound like an angry old man all the time.

echolikebells (#3,272)

@Christy I am so there with this. All of my loans are above 6%, and I’m crazy bitter about it.

nogreeneggs (#154)

@Christy Uh yeah I took out loans between 2005 and 2009 and they were all at 6.8% so this seems neither shocking nor like a hardship to me.

Also I’m so confused when people say they consolidated their loans to lock in a low rate. When I consolidated my loans (in 2009) they took the weighted average of all my loan interest rates. So my consolidated rate was 6.8%. Maybe it’s not like that anymore, maybe you get whatever the new rate is in which case: Congratulations. How wonderful.

@Christy Yeah I’ve been so confused this whole time, I have 6.8% (and some 7something% maybe?) loans I got in 2009 and 2010, guess I picked exactly the wrong two years to go to grad school. Add me to the bitter list too.

Aaron (#4,337)

CubeRootOfPi and Lauren, the original post author, have it correct: This only affects new Subsidized Stafford Loans taken out after July 1 2013.

These loans were originally offered at the same rate as Unsubsidized Stafford Loans (6.8% for the past few years), but for the past couple years they’ve been half-off. That was going to expire last July, but they extended it another year… but it looks like it really will expire this year.

The maximum amount of Subsidized Stafford Loans you can get over 4 years is currently $23,000. If a student starts next month, gets the 6.8% rate instead of the 3.4% rate, and borrows the maximum, it will increase their payments a little bit after they graduate. But not a terrifying amount. And they’ll still be eligible for things like income based repayment if they can’t afford it.

(Yes, I work in the industry. No, I’m not speaking for my employer).

Mrs. Beeton (#320)

I am a college graduate, but I studied English and History and Media, so this is bookmarked.

Yeah…it’s been hard for me to care about this issue. Yes, I do think student loans should be lower, but I’m bitter that college grads a few years younger than me are graduating into a better job market than I did with less of their incomes going to student loans. Solidarity and all that, but I just don’t feel it.

beet hummus (#946)

@franceschances Yeah we got double screwed.
And I thought I was lucky to receive the .25% reduction for doing auto-debit payments. Grumble.

SterlingCooper05 (#2,529)

Is the rate doubling or reverting back to the original amount? It is kinda like saying we received a 2% tax increase in social security in 2013, when a tax break simply expired.

annecara (#1,914)

I started with 6.8% loans and got really excited when they got lowered to 4.8% for good behavior. So. Yeah. It sucks, but I don’t have too much sympathy.

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