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The Senate reached a deal on student loans ahead of the July 1 deadline, which would have seen interest rates doubling.
Senate Majority Leader Harry Reid and Senate Minority Leader Mitch McConnell announced on Tuesday that they had reached a deal on how to pay for the $6 billion price tag of keeping student loan interest rates from doubling, according to Politico.
The announcement of the deal comes just before the July 1 deadline which would have seen rates doubling to 6.8 percent.
McConnell said he and Reid think the agreement on student loans "will be acceptable to the House," according to Politico.
Reid said, "We basically have the student loan issue worked out," according to The Washington Post. He continued, "The next question is, what do we put it on to make sure we can complete it?"
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McConnell's statement would seem to indicate that Republicans are prepared to sign off on the agreement, said The Post.
According to The Post, the federal subsidized loan rates, which will be maintained at 3.4 percent, will be paid for by raising premiums for federal pension insurance. The proposal came from Reid. The agreement also incorporates a Republican suggestion that part-time students would be limited in the number of years they can receive subsidized loans.
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Politico said Congressional leaders are considering attaching the loan rates bill to a massive highway bill, before they break for a weeklong recess on July 4.
The Hill noted that House Republicans surprised Senate leaders in December when they did not approve a short-term deal negotiated by Reid and McConnell on extending the payroll tax holiday. A senior Democratic aide expressed reluctance at calling the student loan bill a done deal until tea party Republicans weighed in.