After months of discussion, Senate leaders appear to have reached a deal that will prevent student loan interest rates from doubling on Sunday.

An agreement, struck between Senate Majority Leader Harry Reid (D-Nev.) and Senate Minority Leader Mitch McConnell (R-Ky.), would keep the interest rates of federally subsidized Stafford loans at 3.4 percent through June 30, 2013, according to a June 26 article by The Associated Press.

Three-fourths of the $6 billion cost would be funded by making it more expensive for companies to get federal insurance for pensions, while the rest would come from a plan to limit the federal subsidies to undergraduates to six-year students.

Both parties previously expressed a desire to reach a deal but had difficulty finding common ground on how to fund the extension.

House Speaker John Boehner has yet to determine if the agreement can be passed in the Republican-run House of Representatives, said spokesman Michael Steele in the article.

On Thursday, President Barack Obama held a news conference calling for Congress to find a solution to this issue. A potential increase would affect 7.4 million students, who would incur an additional $1,000 on their loans if rates doubled to 6.8 percent on the July 1 deadline, he said.

The issue has been widely discussed at Syracuse University.

On April 16, Sen. Charles Schumer of New York visited SU and announced his support for a bill that would stop the increase ––– something that he said would affect 9,483 SU students and 965 students from the State University of New York College of Environmental Science and Forestry.

Chancellor Nancy Cantor also met with Schumer in early June to further discuss the issue.

Published on June 26, 2012 at 12:00 am

Contact Dylan: dmsegelb@syr.edu | @dylan_segelbaum