House Approves Variable Rate for Student Loans

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Lawmakers in the House of Representatives approved a GOP-backed student loan bill on Thursday connecting student loan rates to the financial market in spite of President Obama's threat to veto.

Interest rates on new subsidized Stafford loans are scheduled to double July 1, but the republican supported bill would avoid that.

It provides some students a deal in the first years of the new system before increasing interest rates later.

Many Democrats oppose the plan, including President Obama. He says the bill would eventually impose big interest rate hikes on low and middle class students.

Democrats propose extending current rates for two more years to allow time for finding a permanent fix.

"We need a long-term solution to get us out of these annual, bi-annual, semi-annual political battles," said Education and the Workforce Committee Chairman John Kline, R-Minn. "We want to help students and we want to give them certainty and we want them not to have to rely on the whims of politicians here."

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