<p>Interest</a> rate could double on some student loans ? USATODAY.com</p>
<p>If Congress does not act this year, the interest rates for Federally subsidized Stafford undergrad loans will increase from 3.4 to 6.8%. At the last minute last year, Congress extended the 3.4% rate for one year to July 2013. Any new loans after that date will be charged 6.8%.</p>
<p>Student</a> Loan Interest Rate Hike Fight Bubbles Up In Congress</p>
<p>
How they define as a new loan?
If my kids borrowed last year and need to borrow more later this year; would that count as new loan?</p>
<p>Your kids already have signed Master Promissory notes for their loans and the interest rates are locked into those loans already taken. From what the article says, it will be for the loans taken after July that will be affected unless Congress extends the provisions for a lower rate, but no, this will not affect the loans already taken.</p>
<p>When would we normally sign the promissory notes for the 2013-2014 school year?</p>
<p>Runswscissors-I was wondering the same thing.</p>
<p>Unless things have changed, you don’t sign a new promissory note every year, just if you change schools. The interest rate will be based on the date the loan is disbursed, not the date of the promissory being signed. My daughter signed one promissory note at the beginning of her college years, but her interest rate changed every single year she was in college (not on loans disbursed on previous years, but the new loan disbursed for each year had the interest rate in effect that year). It was the same for my son.</p>
<p>The article does not say for new loans only. On our loans, the interest rate has changed several times through the years. So, it is very possible that the older loans will go up too. The interest rate on the promissary notes are variable.</p>
<p>Between 3 students in our household, we have federal student loans over about 7 years. The rates changed every year but for the loan disbursed in that year, - never for the loans disbursed in prior year. So the ones disbursed in 2007-8 school year are fixed at the rate for the 2007-8 year, the ones for the 2008-9 year are fixed at the rate for 2008-2009 etc etc. </p>
<p>The promissory note date does not matter for the interest rates. it is the date each separate loan is disbursed that matters.</p>
<p>Yes, the Feds cannot retroactively increase interest rates on past loans. However, for Stafford loans that you would take out for the Fall 2013-Spring 2014 school year, the interest rate would be 6.8%.</p>
<p>The article does not say for new loans only. On our loans, the interest rate has changed several times through the years. So, it is very possible that the older loans will go up too. The interest rate on the promissary notes are variable. </p>
<hr>
<p>Interest rates on federal loans have been fixed for as many years as I can remember (at least 25 or so). PRIVATE loan interest rates are variable on some student loans, though. And if a student consolidates, the interest rates will be adjusted. But interest rates are fixed for the life of the loan barring consolidation.</p>
<p>Older loans will not see interest rate increases. Any loan disbursed for the first time after July 1, 2013 may well have a 6.8% interest rate, though, depending on what happens.</p>