| Existing Stafford and PLUS loans are variable-rate loans, which means they'll change every year on July 1. These rates, set by the Department of Education, are based on the three-month Treasury bill auction that takes place in late May. The rate for existing variable-rate Stafford loans will rise from 5.3 percent to 7.14 percent, effective July 1. Meanwhile, rates for PLUS loans, issued to parents and, more recently, graduate students, are also set to increase from 6.1 percent to 7.94 percent. Those who get the paperwork in to their lender by June 30 can lock in lower rates. (Note: The rules change this year for students taking out new loans issued on July 1 or later. Going forward, they will only feature a fixed rate. New Stafford loans issued on or after July 1 of this year will have a 6.8 percent interest rate, while PLUS loans will be 8.5 percent. But variable rate loans issued before July 1 of this year will continue to be reset each year.) replacecontent-tcm:8-23713 |