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] ----------------------------------------------- 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. -------------------------------------------------- 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