Interest rate increase for federal loans will affect veterinary students

Many veterinary students rely at least partially on federal loans to finance their education. That’s why it’s important for veterinary students to be aware that interest rates for federal student loans increased on July 1. We know this change is unwelcome news for veterinary students, and the AVMA is working hard to secure lower interest rates in the reauthorization of the Higher Education Act. The July 1 changes are based on formulas outlined in the Higher Education Act (20  U.S.C. 1087e(b)). Rates for direct unsubsidized loans for graduate students rose to 6 percent, up from 5.31 percent previously. Rates for direct PLUS loans also rose, to 7 percent from 6.31 percent. These rate changes mean that a veterinary student who borrows $50,000 in 2018 will pay approximately $2,000 more over a 10-year standard repayment term than they would have if they had borrowed in 2017.