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<p>[LINK</a> to article](<a href=“Federal student loans rate set to double - Jan. 25, 2012”>Federal student loans rate set to double - Jan. 25, 2012)</p>
<p>President Obama said in his speech the other day that he’s asking Congress to renew the lower rate. We’ll see…</p>
<p>Do note that unsubsidized Stafford rates are already 6.8%. Only subsidized Staffords are at 3.4%. In 08-09, sub interest rate was 6%, in 09-10 it was 5.6%, and in 10-11 it was 4.5%. In 06-07, loans were 6.8%. Grad sub interest is 6.8%, same as grad unsub.</p>
<p>New graduate and professional Stafford loans will no longer be subsidized by the federal government after July 1. In other words, the interest will start to accumulate soon after you take them out. You won’t have to pay the interest until after you graduate, but it continuously adds to the principal on the loan.</p>
<p>That is true, and with the amount many students borrow, it is definitely important to understand how interest accrues.</p>
<p>So the subsidized Stafford loans for the 2012-2013 school year are set to revert back to 6.8%?</p>
<p>Just trying to clarify what ‘this school year’ means?</p>
<p>I guess we really had it good in the late 80’s when interest rates were often in the double digits for mortgages etc., but our guaranteed student loans rate was set at 5% and did not accrue interest for us until graduation.</p>
<p>my student loan rate is only about 2 percent or something like that… same as my car… there’s pretty much no incentive to pay it back early. it’s amazing what rates are on things these days.</p>