Do You Know the Answer?

Q. Does the reduction in interest rates to 6.0 percent effective July 1, 2008 through June 30, 2009 apply to all federal student loans?

A. No. This rate reduction only applies to undergraduate, subsidized Stafford loans. Interest rates on these loans will continue to decline through June 30, 2012, as outlined below.

• July 1, 2009 through June 30, 2010: 5.60 percent
• July 1, 2010 through June 30, 2011: 4.50 percent
• July 1, 2011 through June 30, 2012: 3.40 percent