Student loan interests are to increase on Tuesday for those applying for federal aide. This increase is due to a bipartisan agreement established during extremely high rates last July that tied the loan interest rates to the financial markets. For undergraduate loans, interest rates will increase from 3.86 to 4.66 percent, and for graduate loans will increase from 6.41 percent to 7.21. According to Bloomberg Business Week:
For every $10,000 borrowed, the average borrower under the hike will pay back about $4 more every month when they begin paying back the money — about the price of a fancy latte.
Should the nation’s economy continue to improve, it is projected that rates will continue to increase. While rates are often reevaluated, current borrowers will be stuck with their rate for the life of their loan.
Read more here-“ Student Loan Interest Rates to Increase,” (Kimberly Hefling, Bloomberg Business Week)