New Variable Interest Rates July 1, 1998 - June 30, 1999

Federal Stafford Variable Interest Rates

The final auction of 91-day Treasury Bills held prior to June 1 occurred on May 26, 1998, and the bond equivalent rate was 5.155 which rounds to 5.16%.

For converted variable-rate 8/10% loans that were subject to "windfall profits" and have been converted to a variable interest rate capped at 10%:

5.16% + 3.25% = 8.41%

For converted variable-rate 7%, 8%, 9%, or 10% (converted 8/10% loans which have reached the 49th month of the repayment period), that were subject to "windfall profits" and have been converted to a variable interest rate capped at the original fixed interest rate, the following rates apply:

5.16 + 3.1% = 8.26%

For regular variable-rate loans made to "new" borrowers for which the first disbursement is on/after October 1, 1992 but prior to July 1, 1994 or on/after July 1, 1994 for a period of enrollment ending prior to July 1, 1994, capped at 9%:

5.16% + 3.1% = 8.26%

For loans made to all borrowers, regardless of prior borrowing, for periods of enrollment that include or begin on/after July 1, 1994 for which the first disbursement is made on-after July 1, 1994 but prior to July 1, 1995, capped at 8.25%:

5.16 + 3.1% = 8.26%: the rate is 8.25%

For loans made to all borrowers, regardless of prior borrowing, on/after July 1, 1995, but prior to July 1, 1998, capped at 8.25%:

during the in-school, grace, and deferment periods

5.16% + 2.5% = 7.66%

during the repayment period, except for deferment periods, capped at 8.25%.

5.16% + 3.1% = 8.26%: the rate is 8.25%

For loans made to all borrowers, regardless of prior borrowing, on/after 7/1/98 and before 10/1/98, capped at 8.25%:

during the in-school, grace, and deferment periods

5.15% + 1.7% = 6.86%

during the repayment period, except for deferment periods, capped at 8.25%.

5.16% + 2.3% = 7.46%

Federal PLUS and Federal SLS Variable Interest Rates

The final auction of 52-week Treasury Bills held prior to June 1 occurred on May 28, 1998, and the bond equivalent rate was 5.434% which rounds to 5.43%.

*For variable rate PLUS and SLS loans made prior to October 1, 1992, capped at 12%:

5.43% + 3.25% = 8.68%

*For PLUS loans made on/after October 1, 1992 but prior to July 1, 1994, capped at 10%; for PLUS loans made on/after July 1, 1994, but prior to July 1, 1998, capped at 9%; and for SLS loans made on/after October 1, 1992 for a period of enrollment beginning prior to July 1, 1994, capped at 11%:

5.43% + 3.1% = 8.53%

*PLUS/SLS loans are not eligible for special allowance payments during the four quarters ending September 30, 1998, December 31, 1998, March 31, 1999, and June 30, 1999.