Publication Date: August 29, 2013
Posted Date: August 29, 2013
Subject: Annual notice of interest rates on Direct Loans made prior to July 1, 2013
FR Type: Notice
[Federal Register Volume 78, Number 168 (Thursday, August 29, 2013)]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2013-21144]
DEPARTMENT OF EDUCATION
[Catalog of Federal Domestic Assistance (CFDA) Number: 84.268]
Annual Notice of Interest Rates of Federal Student Loans Made
Under the William D. Ford Federal Direct Loan Program Prior to July 1,
AGENCY: Federal Student Aid, Department of Education.
SUMMARY: In accordance with 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, 2013,
through June 30, 2014, for loans made under the William D. Ford Federal
Direct Loan (Direct Loan) Program prior to July 1, 2013. The Chief
Operating Officer takes this action to give notice of Direct Loan
interest rates to the public.
DATES: This notice is effective August 29, 2013.
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: email@example.com.
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-
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
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 28, 2013, which is used to
calculate the interest rates on these loans, is 0.046 percent, which is
rounded to 0.05 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 21, 2013, which is used to calculate the interest
rate on these loans, is 0.13 percent.
This notice includes five charts containing specific information on
the calculation of the interest rates for loans made under the Direct
Loan Program prior to July 1, 2013. We publish a separate notice
containing the interest rates for Direct Loans made for the current
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
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, and
Direct Consolidation Loans.
*NOTE: CHART OMITTED -- SEE PDF FILE
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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.
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by the Department.
Program Authority: 20 U.S.C. 1087 et seq.
Dated: August 26, 2013.
James F. Manning,
Chief of Staff of Federal Student Aid, delegated the authority to
perform the functions and duties of the Chief Operating Officer of
Federal Student Aid.
[FR Doc. 2013-21144 Filed 8-28-13; 8:45 am]
BILLING CODE 4000-01-P