Federal lawmakers failed to reach a decision on Stafford student loan interest rates, causing them to double from 3.4 percent to 6.8 percent overnight on July 1, but the debate isn’t over.

Federally subsidized student loans are a major source of financial aid across the nation with 7 million students expected to take out loans this year. At N.C. State, about 50 percent of all students who graduated in 2012 had student loans. 

The increase doesn’t apply to existing loans, but loans taken out after July 1 will be subject to the new rate.

Krista Dominic, the director of the Office of Scholarships and Financial Aid at N.C. State,  said that being responsible with money can help ease the burden of a loan.

“Responsible borrowing is very important. Students need to borrow what they need and keep their balances as low as possible,” Dominic said. 

According to Dominic, the standard time it takes to pay off student loans is 10 years. The higher interest rate could increase that time by several years.

Richard Wolfe, a junior in economics at N.C. State, will receive his first loan in August under the new rate.

“Personally, when I graduate, I am still going to look for a job that fulfills my best interests whether it’s higher paying or not, “ Wolfe said. “Depending on the true value of the dollar, plans to buy a house or car could be delayed.”

For students who will be taking out loans under the new higher interest rates, there is chance for that to change.

On July 10, the Senate tried to vote to extend the 3.4 percent rate by one year in an attempt to give lawmakers time to reach a decision. However, that failed to reach a 60 majority with the vote ending at 51 for and 49 against.

Despite failing to extend the deadline by a year, Congress can still lower the subsidized federal loan interest rate even though the July 1 deadline passed.

“If Congress acts to retroactively set the subsidized federal direct loan interest rate to something other than 6.8 percent, that new interest rate would apply as long as the language used indicated that the new rate was applicable to loans disbursed after July 1,” Dominic said. 

If Congress extends the deadline or retroactively changes the rate, students taking loans under the new rates will be able to avoid the 6.8 percent rate. 

Currently, outstanding student loan debt in the U.S. is greater than $1 trillion. According to a survey from the American Institute of CPAs, student loans cause graduates to delay buying a house, buying a car and saving for retirement. 

Graduates from the class of 2012 at N.C. State on average had a federal loan debt of $23,697.

Additionally, 60 percent of people in the survey said they felt some amount of regret for choosing to take out loans.

Whatever Congress decides, it is likely that it will act soon.

“Congress can still act to change the doubled rate, and they can do that in a retroactive action,” Dominic said. “It remains to be seen if they will make any change to the interest rate for subsidized loans.”