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Subject: Annual Notice of Interest Rates of Federal Student Loans Made Under the William D. Ford Federal Direct Loan Program

Publication Date: January 25, 2013

Posted Date: January 25, 2013

Subject: Annual Notice of Interest Rates of Federal Student Loans Made Under the William D. Ford Federal Direct Loan Program

FR Type: Notice


[Federal Register Volume 78, Number 17 (Friday, January 25, 2013)]
[Notices]
[Pages 5431-5433]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2013-01421]

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DEPARTMENT OF EDUCATION

Annual Notice of Interest Rates of Federal Student Loans Made 
Under the William D. Ford Federal Direct Loan Program

AGENCY: Federal Student Aid, Department of Education.

ACTION: Notice.

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Catalog of Federal Domestic Assistance (CFDA) Number: 84.268.

DATES: This notice is effective January 25, 2013.
SUMMARY: In accordance with by section 455(b)(9) of the Higher 
Education Act of 1965, as amended, the Chief Operating Officer for 
Federal Student Aid announces the interest rates for the period July 1, 
2012, through June 30, 2013, for loans made under the William D. Ford 
Federal Direct Loan (Direct Loan) Program. The Chief Operating Officer 
takes this action to give notice of Direct Loan interest rates to the 
public.

FOR FURTHER INFORMATION CONTACT: Ian Foss, U.S. Department of 
Education, 830 First Street NE., room 114I1, Washington, DC 20202. 
Telephone: (202) 377-3681 or by email: ian.foss@ed.gov.
    If you use a telecommunications device for the deaf (TDD) or a text 
telephone (TTY), call the Federal Relay Service (FRS), toll free, at 1-
800-877-8339.
    Individuals with disabilities can obtain this document in an 
accessible format (e.g., braille, large print, audiotape, or compact 
disc) 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 Subsidized 
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 before July 1, 2006, have variable interest rates that 
change each year. In most cases, 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.
    Under section 455(b) of the HEA, Direct Loans first disbursed on or 
after July 1, 2006, have a fixed interest rate.
    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. This fixed rate is based on the weighted average of the 
loans that are consolidated, rounded up to the nearest higher \1/8\ of 
one percent up to a maximum rate of 8.25 percent.
    Under section 455(b) of the HEA, the Direct Loan variable interest 
rates are based on formulas that use the bond equivalent rates of the 
91-day Treasury bills auctioned at the final auction held before June 1 
of each year, plus a statutory add-on percentage. These formulas apply 
to 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. In each case, the calculated rate 
is capped by a maximum interest rate. The bond equivalent rate of the 
91-day Treasury bills auctioned on May 29, 2012, which is used to 
calculate the interest rates on these loans, is 0.086 percent, which is 
rounded to 0.09 percent.
    In addition, under section 455(b)(4) of the HEA, the interest rate 
for Direct PLUS Loans that were first disbursed on or after July 1, 
1994, and before July 1, 1998, is based on the weekly average of the 
one-year constant maturity Treasury yield, as published by the Board of 
Governors of the Federal Reserve System on the last day of the calendar 
week ending on or before June 26 of each year, plus a statutory add-on 
percentage. The calculated rate is capped by a maximum interest rate. 
The weekly average of the one-year constant maturity Treasury yield 
published on June 22, 2012, which is used to calculate the interest 
rate on these loans, is 0.19 percent.
    This notice includes five charts containing specific information on 
the calculation of the interest rates for loans made under the Direct 
Loan Program.
    Chart 1 contains information on the interest rates for variable-
rate Direct Subsidized and Direct Unsubsidized Loans.
    Chart 2 contains information on the interest rates for variable-
rate Direct PLUS Loans.
    Chart 3 contains information on the interest rates for variable-
rate Direct Subsidized Consolidation Loans and Direct Unsubsidized 
Consolidation Loans.
    Chart 4 contains information on the interest rates for variable-
rate Direct PLUS Consolidation Loans.
    Chart 5 contains information on the interest rates for fixed-rate 
Direct Subsidized, Direct Unsubsidized, and Direct PLUS Loans.

** NOTE: CHART OMITTED --SEE PDF FILE

    Note: Under the Budget Control Act of 2011 (Pub. L. 112-25) and 
effective for loan periods beginning on or after July 1, 2012, 
graduate and professional students are no longer eligible for Direct 
Subsidized Loans.

    Electronic Access to This Document: 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 via the Federal Digital System 
at: www.gpo.gov/fdsys. At this site you can 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). To use PDF 
you must have Adobe Acrobat Reader, which is available free at the 
site.
    You may also access documents of the Department published in the 
Federal Register by using the article search feature at: 
www.federalregister.gov. Specifically, through the advanced search 
feature at this site, you can limit your search to documents published 
by the Department.
    Program Authority: 20 U.S.C. 1087 et seq.

    Dated: January 18, 2013.
James W. Runcie,
Chief Operating Officer, Federal Student Aid.
[FR Doc. 2013-01421 Filed 1-24-13; 8:45 am]
BILLING CODE 4000-01-P
 


Last Modified: 01/24/2013