Publication Date: November 6, 2007
FRPart:
Page Numbers: 62637-62639
Summary: Notice of interest rates for the William D. Ford Federal Direct Loan Program for the period July 1, 2007 through June 30, 2008
Posted on 11-06-2007
[Federal Register: November 6, 2007 (Volume 72, Number 214)]
[Notices]
[Page 62637-62639]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr06no07-41]
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DEPARTMENT OF EDUCATION
William D. Ford Federal Direct Loan Program
AGENCY: Federal Student Aid, Department of Education.
ACTION: Notice of interest rates for the William D. Ford Federal Direct
Loan Program for the period July 1, 2007 through June 30, 2008.
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SUMMARY: The Acting Chief Operating Officer for Federal Student Aid
announces the interest rates for the period July 1, 2007 through June
30, 2008 for loans made under the William D. Ford Federal Direct Loan
(Direct Loan) Program.
FOR FURTHER INFORMATION CONTACT: Don Watson, U.S. Department of
Education, Room 114I2, UCP, 400 Maryland Avenue, SW., Washington, DC
20202-5400. Telephone: (202) 219-7037.
If you use a telecommunications device for the deaf (TDD), you may
call the Federal Relay Service (FRS) at 1-800-877-8339.
Individuals with disabilities may obtain this document in an
alternative format (e.g., Braille, large print, audiotape, or computer
diskette) on request to the contact person listed under FOR FURTHER
INFORMATION CONTACT.
SUPPLEMENTARY INFORMATION: Section 455(b) of the Higher Education Act
of 1965, as amended (HEA), 20 U.S.C. 1087e(b), provides formulas for
determining the interest rates charged to borrowers for loans made
under the Direct Loan Program including: Federal Direct Stafford Loans
(Direct Subsidized Loans); Federal Direct Unsubsidized Stafford Loans
(Direct Unsubsidized Loans); Federal Direct PLUS Loans (Direct PLUS
Loans); and Federal Direct Consolidation Loans (Direct Consolidation
Loans).
The Direct Loan Program includes loans with variable interest rates
and loans with fixed interest rates. Most loans made under the Direct
Loan Program have variable interest rates that change each year. The
variable interest rate formula that applies to a particular loan
depends on the date of the first disbursement of the loan. The variable
rates are determined annually and are effective for each 12-month
period beginning July 1 of one year and ending June 30 of the following
year. Pursuant to section 455(b) of the HEA, 20 U.S.C. 1087e(b), the
interest rate for Direct Subsidized Loans and Direct Unsubsidized Loans
that are first disbursed on or after July 1, 2006, have a fixed
interest rate of 6.80 percent. Direct PLUS Loans that are first
disbursed on or after July 1, 2006, have a fixed interest rate of 7.90
percent.
In the case of some Direct Consolidation Loans, the interest rate
is determined by the date on which the Direct Consolidation Loan
application was received. Direct Consolidation Loans for which the
application was received on or after February 1, 1999 have a fixed
interest rate based on the weighted average of the loans that are
consolidated, rounded up to the nearest higher \1/8\ of one percent.
Pursuant to section 455(b) of the HEA, 20 U.S.C. 1087e(b), the
Direct Loan interest rate formulas use the bond equivalent rates of the
91-day Treasury bills at the final auction held before June 1 of each
year plus a statutory add-on percentage to determine the variable
interest rate for all Direct Subsidized Loans and Direct Unsubsidized
Loans; Direct Consolidation Loans for which the application was
received on or after July 1, 1998 and before February 1, 1999; and
Direct PLUS Loans disbursed on or after July 1, 1998.
The bond equivalent rate of the 91-day Treasury bills auctioned on
May 29, 2007, which is used to calculate the interest rates on these
loans, is 4.919 percent, which is rounded to 4.92 percent.
In addition, pursuant to section 455(b) of the HEA, 20 U.S.C.
1087e(b), as
[[Page 62638]]
amended by Public Law 106-554, the Consolidated Appropriations Act,
2001, the interest rate for Direct PLUS Loans that were disbursed on or
after July 1, 1994 and on or before July 1, 1998, is calculated based
on the weekly average of a 1-year constant maturity Treasury yield, as
published by the Board of Governors of the Federal Reserve System, for
the last calendar week ending on or before June 26 plus a statutory
add-on percentage.
The weekly average of 1-year constant maturity Treasury yield for
the last week ending on or before June 26, 2007 is 4.95 percent.
Below is specific information on the calculation of the interest
rates for the Direct Loan Program. This information is listed in order
by the date a loan was first disbursed or by the date that the
Consolidation Application was received.
For Direct Loan Program Loans First Disbursed On or After July 1, 1994,
and Before July 1, 1995
The interest rate for Direct Subsidized Loans, Direct Unsubsidized
Loans, and Direct Subsidized and Unsubsidized Consolidation Loans is
the bond equivalent rate of the 91-day Treasury bills auctioned at the
final auction held before June 1 plus 3.1 percent. These interest rates
may not exceed 8.25 percent during any period. From July 1, 2007, to
June 30, 2008, the interest rate for Direct Subsidized Loans, Direct
Unsubsidized Loans, and Direct Subsidized and Unsubsidized
Consolidation Loans that were first disbursed on or after July 1, 1994,
and before July 1, 1995, is 8.02 percent (4.92 percent plus 3.1
percent) during all periods.
The interest rate for Direct PLUS Loans and Direct PLUS
Consolidation Loans is the weekly average of a 1-year constant maturity
Treasury yield, as published by the Board of Governors of the Federal
Reserve System, for the last calendar week ending on or before June 26
plus 3.1 percent. These interest rates may not exceed 9.0 percent
during any period. From July 1, 2007, to June 30, 2008, the interest
rate for Direct PLUS Loans and Direct PLUS Consolidation Loans that
were first disbursed on or after July 1, 1994 and before July 1, 1995,
is 8.05 (4.95 percent plus 3.1 percent) percent for all periods.
For Direct Loan Program Loans First Disbursed On or After July 1, 1995,
and Before July 1, 1998
The interest rate for Direct Subsidized Loans, Direct Unsubsidized
Loans, and Direct Subsidized and Unsubsidized Consolidation Loans is
the bond equivalent rate of the 91-day Treasury bills auctioned at the
final auction held before June 1 plus 3.1 percent. However, during in-
school, grace, and deferment periods, the interest rate formula is the
bond equivalent rate of the 91-day Treasury bills auctioned at the
final auction held before June 1 plus 2.5 percent. These interest rates
may not exceed 8.25 percent during any period. From July 1, 2007, to
June 30, 2008, the interest rate for Direct Subsidized Loans, Direct
Unsubsidized Loans, and Direct Subsidized and Unsubsidized
Consolidation Loans that were first disbursed on or after July 1, 1995,
and before July 1, 1998, is 7.42 percent (4.92 percent plus 2.5
percent) during in-school, grace, and deferment periods and 8.02
percent (4.92 percent plus 3.1 percent) during all other periods.
The interest rate for Direct PLUS Loans and Direct PLUS
Consolidation Loans is the weekly average of a 1-year constant maturity
Treasury yield, as published by the Board of Governors of the Federal
Reserve System, for the last calendar week ending on or before June 26
plus 3.1 percent. These interest rates may not exceed 9.0 percent
during any period. From July 1, 2007, to June 30, 2008, the interest
rate for Direct PLUS Loans and Direct PLUS Consolidation Loans that
were first disbursed on or after July 1, 1995 and before July 1, 1998,
is 8.05 percent (4.95 percent plus 3.1 percent) during all periods.
For Direct Loans First Disbursed On or After July 1, 1998, and Before
October 1, 1998
The interest rate for Direct Subsidized Loans, Direct Unsubsidized
Loans, and Direct Subsidized and Unsubsidized Consolidation Loans is
the bond equivalent rate of the 91-day Treasury bills auctioned at the
final auction held before June 1 plus 2.3 percent. However, during in-
school, grace, and deferment periods, the interest rate formula is the
bond equivalent rate of the 91-day Treasury bills auctioned at the
final auction held before June 1 plus 1.7 percent. These interest rates
may not exceed 8.25 percent during any period. From July 1, 2007, to
June 30, 2008, the interest rate for Direct Subsidized Loans, Direct
Unsubsidized Loans, and Direct Subsidized and Unsubsidized
Consolidation Loans that were first disbursed on or after July 1, 1998
and before October 1, 1998, is 6.62 percent (4.92 percent plus 1.7
percent) during in-school, grace, and deferment periods and 7.22
percent (4.92 percent plus 2.3 percent) during all other periods.
The interest rate for Direct PLUS Loans and Direct PLUS
Consolidation Loans is the bond equivalent rate of the 91-day Treasury
bills auctioned at the final auction held before June 1 plus 3.1
percent. These interest rates may not exceed 9.0 percent during any
period. From July 1, 2007, to June 30, 2008, the interest rate for
Direct PLUS Loans and Direct PLUS Consolidation Loans that were
disbursed on or after July 1, 1998, and before October 1, 1998, is 8.02
percent (4.92 percent plus 3.1 percent) during all periods.
For Direct Subsidized Loans, Direct Unsubsidized Loans, and Direct PLUS
Loans First Disbursed On or After October 1, 1998, and Before July 1,
2006
The interest rate for Direct Subsidized Loans and Direct
Unsubsidized Loans is the bond equivalent rate of the 91-day Treasury
bills auctioned at the final auction held before June 1 plus 2.3
percent. However, during in-school, grace, and deferment periods, the
interest rate formula is the bond equivalent rate of the 91-day
Treasury bills plus 1.7 percent. These interest rates may not exceed
8.25 percent during any period. From July 1, 2007, to June 30, 2008,
the interest rate for Direct Subsidized Loans and Direct Unsubsidized
Loans that were disbursed after July 1, 1998, and before July 1, 2006,
is 6.62 percent (4.92 percent plus 1.7 percent) during in-school,
grace, and deferment periods and 7.22 percent (4.92 percent plus 2.3
percent) during all other periods.
The interest rate for Direct PLUS Loans is the bond equivalent rate
of the 91-day Treasury bills auctioned at the final auction held before
June 1 plus 3.1 percent. These interest rates may not exceed 9.0
percent during any period. From July 1, 2007, to June 30, 2008, the
interest rate for Direct PLUS Loans that were disbursed after July 1,
1998, and before July 1, 2006, is 8.02 percent (4.92 percent plus 3.1
percent) during all periods.
For Direct Subsidized Loans, Direct Unsubsidized Loans, and Direct PLUS
Loans First Disbursed On or After July 1, 2006
The interest rate for Direct Subsidized Loans and Direct
Unsubsidized Loans that were first disbursed on or after July 1, 2006
is a fixed interest rate of 6.80 percent during all periods.
The interest rate for Direct PLUS Loans that were first disbursed
on or after July 1, 2006 is a fixed interest rate of 7.90 percent
during all periods.
[[Page 62639]]
For Direct Consolidation Loans First Disbursed On or After October 1,
1998 and For Which the Application Was Received Before October 1, 1998
The interest rate for Direct Subsidized and Unsubsidized
Consolidation Loans is the bond equivalent rate of the 91-day Treasury
bills auctioned at the final auction held before June 1 plus 2.3
percent. However, during in-school, grace, and deferment periods, the
interest rate formula is the bond equivalent rate of the 91-day
Treasury bills auctioned at the final auction held before June 1 plus
1.7 percent. These interest rates may not exceed 8.25 percent during
any period. From July 1, 2007, to June 30, 2008, the interest rate for
Direct Subsidized and Unsubsidized Consolidation Loans that were first
disbursed on or after October 1, 1998 and for which the application was
received before October 1, 1998, is 6.62 percent (4.92 percent plus 1.7
percent) during in-school, grace, and deferment periods and 7.22
percent (4.92 percent plus 2.3 percent) during all other periods.
The interest rate for Direct PLUS Consolidation Loans is the bond
equivalent rate of the 91-day Treasury bills auctioned at the final
auction held before June 1 plus 3.1 percent. These interest rates may
not exceed 9.0 percent during any period. From July 1, 2007, to June
30, 2008, the interest rate for Direct PLUS Loans and Direct PLUS
Consolidation Loans that were first disbursed on or after October 1,
1998 and for which the application was received before October 1, 1998,
is 8.02 percent (4.92 percent plus 3.1 percent) during all periods.
For Direct Consolidation Loans For Which the Application Was Received
On or After October 1, 1998, and Before February 1, 1999
The interest rate for Direct Consolidation Loans for which the
application was received on or after October 1, 1998 and before
February 1, 1999 is the bond equivalent rate of the 91-day Treasury
bills auctioned at the final auction held before June 1 plus 2.3
percent. These interest rates may not exceed 8.25 percent during any
period. From July 1, 2007, to June 30, 2008, the interest rate for
Direct Consolidation Loans for which the application was received on or
after October 1, 1998 and before February 1, 1999, is 7.22 percent
(4.92 percent plus 2.3 percent) during all periods.
For Direct Consolidation Loans For Which the Application Was Received
On or After February 1, 1999
The interest rate for Direct Consolidation Loans for which the
application was received on or after February 1, 1999, is the lesser of
8.25 percent, or the weighted average of the loans consolidated,
rounded to the nearest higher \1/8\ of one percent.
Electronic Access to This Document: You may view this document, as
well as all other documents of this Department published in the Federal
Register, in text or Adobe Portable Document Format (PDF) on the
Internet at the following site: http://www.gpoaccess.gov/nara/index.html.
To use PDF you must have Adobe Acrobat Reader, which is available
free at this site. If you have questions about using PDF, call the U.S.
Government Printing Office (GPO), toll free at 1-888-293-6498; or in
the Washington, DC area at (202) 512-1530.
Note: The official version of this document is the document
published in the Federal Register. Free Internet access to the
official edition of the Federal Register and the Code of Federal
Regulations is available on GPO Access at: http://www.gpoaccess.gov/nara/index.html.
Program Authority: 20 U.S.C. 1087 et seq..
Dated: October 31, 2007.
Lawrence A. Warder,Acting Chief Operating Officer, Federal Student Aid.
[FR Doc. E7-21807 Filed 11-5-07; 8:45 am]
BILLING CODE 4000-01-P
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