The framework that is being negotiated by Sens. Joe Manchin (D-WV), Tom Coburn (R-OK) and Angus King (I-VT) would tie the rate to the 10-year Treasury note plus one additional percentage point, Senate sources familiar with the discussions tell TPM.
The deal isn’t yet final. The senators are expecting a report Friday from the Congressional Budget Office on how much the plan would cost, one source said.
The idea of tying the loan rate to the market was proposed by President Obama in his fiscal 2014 budget. Republicans support the idea. Top Senate Democrats dislike it. The yield on the 10-year T-bill is currently 2.48 percent.
A Senate Republican leadership aide described the bipartisan negotiations as “good news.”
If Congress fails to take action, the average student loan borrower is poised to pay an additional $2,600 over a decade, according to a report Thursday by Congress’s Joint Economic Committee.
