But Democrats argued that the bill would actually allow the rates to rise above 6.8 percent in the coming years and would create a variable loan rate system for students, which means they could be forced to pay higher rates on old loans.
The passage of the bill has set up a June fight between Republicans and Democrats over how to solve the problem.
Under Obama's plan, loan rates would equal the 10-year Treasury note rate, plus 0.9 percent, but did not include a cap on rates. Obama's plan also calls for a rate that is fixed for the life of the loan, instead of the variable rate.
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