H.R. 1911: Smarter Solutions for Students Act (Renamed the Bipartisan Student Loan Certainty Act of 2013)

H.R. 1911

Smarter Solutions for Students Act (Renamed the Bipartisan Student Loan Certainty Act of 2013)

Sponsor
Rep. John Kline

Date
July 31, 2013 (113th Congress, 1st Session)

Staff Contact
Kimberly Betz

Floor Situation

On Wednesday, July 31, 2013, the House will consider the Senate Amendment to H.R. 1911. The Senate Amendment was agreed to on July 23, 2013 by a vote of 81-18.[1]

Bill Summary

Like H.R. 1911, the Senate Amendment moves all new student loans (except Perkins loans) to a market-based interest rate. The bill authorizes student loan interest rates to be reset once a year and move with the market. Once a student takes out a loan, the interest rate will become fixed for the life of the loan, much like a fixed rate mortgage. Interest rates would be set using the following formula: undergraduate Stafford Loans (both subsidized and unsubsidized): 10-year Treasury note plus 2.05 percent, capped at 8.25 percent. Graduate unsubsidized Stafford loans: 10-year Treasury note plus 3.6 percent, capped at 9.5 and PLUS loans (both parent and graduate student): 10-year Treasury note plus 4.6 percent, capped at 10.5 percent. The bill eliminates the consolidation loan “cap,” which is currently 8.25 percent. 

Background

On Thursday, May 23, 2013, the House passed H.R. 1911, the Smarter Solutions for Students Act, by a vote of 221-198.[1]  H.R. 1911 set student loan rates using the following formula: Stafford Loans (both subsidized and unsubsidized): 10-year Treasury note plus 2.5 percent, capped at 8.5 percent. PLUS loans (graduate and parent): 10-year Treasury note plus 4.5 percent, capped at 10.5 percent.

Cost

According to CBO, enacting the Senate Amendment to H.R. 1911 will save the federal government approximately $715 million over ten years.[1]

Additional Information

For questions or further information contact the GOP Conference at 5-5107.