[Federal Register Volume 82, Number 158 (Thursday, August 17, 2017)]
[Notices]
[Pages 39111-39113]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2017-17424]


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DEPARTMENT OF EDUCATION


Annual Notice of Variable Interest Rates of Federal Student Loans 
Made Under the Federal Family Education Loan Program Prior to July 1, 
2010

AGENCY: Federal Student Aid, Department of Education (ED).

ACTION: Notice.

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SUMMARY: The Chief Operating Officer for Federal Student Aid announces 
the variable interest rates for the period July 1, 2017, through June 
30, 2018, for certain loans made under the Federal Family Education 
Loan (FFEL) Program. The Chief Operating Officer takes this action to 
give notice of FFEL Program loan variable interest rates to the public.

DATES: This notice is applicable August 17, 2017.

FOR FURTHER INFORMATION CONTACT: Rene Tiongquico, U.S. Department of

[[Page 39112]]

Education, 830 First Street NE., 11th floor, Washington, DC 20202. 
Telephone: (202) 377-4270 or by email: <a href="/cdn-cgi/l/email-protection#7123141f145f25181e1f16000418121e3114155f161e07"><span class="__cf_email__" data-cfemail="96c4f3f8f3b8c2fff9f8f1e7e3fff5f9d6f3f2b8f1f9e0">[email protected]</span></a>.
    If you use a telecommunications device for the deaf (TDD) or a text 
telephone (TTY), call the Federal Relay Service (FRS), toll free, at 1-
800-877-8339.
    Individuals with disabilities can obtain this document in an 
accessible format (e.g., braille, large print, audiotape, or compact 
disc) on request to the contact person listed under FOR FURTHER 
INFORMATION CONTACT.

SUPPLEMENTARY INFORMATION: Catalog of Federal Domestic Assistance 
(CFDA) Number: 84.032.
    Section 427A of the Higher Education Act of 1965, as amended (HEA) 
(20 U.S.C. 1077a), provides formulas for determining the interest rates 
charged to borrowers on loans made under the FFEL Program, including 
Federal Subsidized and Unsubsidized Stafford Loans, Federal PLUS Loans, 
and Federal Consolidation Loans.
    The FFEL Program includes loans with variable interest rates and 
loans with fixed interest rates. Most loans made under the FFEL Program 
before July 1, 2006, have variable interest rates that change each 
year. In most cases, the variable interest rate formula that applies to 
a particular loan depends on the date of the first disbursement of the 
loan. The variable rates are determined annually and are effective for 
each 12-month period beginning July 1 of one year and ending June 30 of 
the following year.
    Under section 427A(l) of the HEA, FFEL Program loans first 
disbursed on or after July 1, 2006, and before July 1, 2010, have a 
fixed interest rate. Interest rates for these loans may be found in a 
Federal Register notice published on September 15, 2015 (80 FR 55342).
    Federal Consolidation Loans made prior to November 13, 1997, and on 
or after October 1, 1998, have a fixed interest rate that is based on 
the weighted average of the loans that are consolidated. Interest rates 
for Federal Consolidation Loans made between November 13, 1997, and 
September 30, 1998, are provided in Chart 3.
    FFEL variable interest rates are based on formulas that use the 
bond equivalent rate of the 91-day Treasury bill auctioned at the final 
auction held before June 1 of each year plus a statutorily established 
add-on. These formulas apply to: All Federal Subsidized and 
Unsubsidized Stafford Loans first disbursed before October 1, 1992, 
that have been converted to variable rate loans; all Federal Subsidized 
and Unsubsidized Stafford Loans first disbursed on or after October 1, 
1992, and before July 1, 2006; Federal PLUS Loans first disbursed on or 
after July 1, 1998, and before July 1, 2006; and Federal Consolidation 
Loans for which the Federal Consolidation Loan application was received 
on or after November 13, 1997, and before October 1, 1998. In each 
case, the calculated rate is capped by a maximum interest rate. The 
bond equivalent rate of the 91-day Treasury bills auctioned on May 30, 
2017, which is used to calculate the interest rates on these loans, is 
0.976 percent rounded up to 0.98 percent.
    For Federal PLUS loans first disbursed before July 1, 1998, the 
interest rate is based on the weekly average of the one-year constant 
maturity Treasury yield, as published by the Board of Governors of the 
Federal Reserve System for the last day of the calendar week ending on 
or before June 26 of each year, plus a statutory add-on percentage. The 
calculated rate is capped by a maximum interest rate. The weekly 
average of the one-year constant maturity Treasury yield published on 
June 26, 2017, which is used to calculate the interest rate on these 
loans, is 1.22 percent.
    For Federal Consolidation loans for which the application was 
received by the lender on or after November 13, 1997, the interest rate 
that includes portions of Federal Consolidation Loans attributable to 
loans made by the U.S. Department of Health and Human Services under 
subpart I of part A of title VII of the Public Health Service Act, is 
based on the average of the bond equivalent rates of the 91-day 
Treasury bills auctioned for the quarter ending June 30, 2017, plus a 
statutory add-on percentage. There is no maximum interest rate for 
these loans. The average of the bond equivalent rates of the 91-day 
Treasury bill auctioned for the quarter ending on June 30, 2017, which 
is used to calculate the interest rate on these loans, is 0.92 percent.
    This notice includes three charts containing specific information 
on the calculation of variable interest rates for loans made under the 
FFEL Program:
    Chart 1 contains information on the interest rates for Federal 
Subsidized and Unsubsidized Stafford Loans that were made as fixed-rate 
loans, but were subsequently converted to variable-rate loans.
    Chart 2 contains information on the interest rates for variable-
rate Federal Subsidized and Unsubsidized Stafford Loans.
    Chart 3 contains information on the interest rates for variable-
rate Federal PLUS Loans, certain Federal Consolidation Loans, and 
Consolidation Loans that include loans made by the U.S. Department of 
Health and Human Services under subpart I of part A of title VII of the 
Public Health Service Act.

 Chart 1--``Converted'' Variable-Rate Federal Subsidized and Unsubsidized Stafford Loans Interest Rates in Effect for the Period 7/1/2017 Through 6/30/
                                                                          2018
--------------------------------------------------------------------------------------------------------------------------------------------------------
                          Cohort
-----------------------------------------------------------
                                                 First      Original fixed interest rate   Max. rate (%)   91-Day T-bill    Margin (%)    Total rate (%)
        First disbursed on or after            disbursed                 (%)                                 rate (%)
                                                before
--------------------------------------------------------------------------------------------------------------------------------------------------------
7/1/1988..................................       7/23/1992  8.00, increasing to 10.00...           10.00            0.98            3.25            4.23
7/23/1992.................................       10/1/1992  8.00, increasing to 10.00...           10.00            0.98            3.25            4.23
7/23/1992.................................        7/1/1994  7.00........................            7.00            0.98            3.10            4.08
7/23/1992.................................        7/1/1994  8.00........................            8.00            0.98            3.10            4.08
7/23/1992.................................        7/1/1994  9.00........................            9.00            0.98            3.10            4.08
7/23/1992.................................        7/1/1994  8.00, increasing to 10.00...           10.00            0.98            3.10            4.08
--------------------------------------------------------------------------------------------------------------------------------------------------------


    Note: The FFEL Program loans represented by the second row of 
the chart were only made to ``new borrowers'' on or after July 23, 
1992. Whether the FFEL Program loans represented by the third 
through sixth rows of Chart 1 were made to a specific borrower 
depends on the interest rate on the borrower's existing loans (see 
the ``Original Fixed Interest Rate'' column in Chart 1) at the time 
the borrower received the loan(s) on or after July 23, 1992, and 
prior to July 1, 1994.

    In Charts 2 and 3, a dagger following a date in a cohort field 
indicates that the

[[Page 39113]]

trigger for the rate to apply is a period of enrollment for which the 
loan was intended either ``ending before'' or ``beginning on or after'' 
the date in the cohort field.

      Chart 2--Variable-Rate Federal Subsidized and Unsubsidized Stafford Loans Interest Rates in Effect for the Period 7/1/2017 Through 6/30/2018
--------------------------------------------------------------------------------------------------------------------------------------------------------
                         Cohort                                                                       Margin                      Total rate (%)
---------------------------------------------------------                                ---------------------------------------------------------------
                                               First         Max. rate     91-Day T-bill    In-school,                      In-school,
       First disbursed on or after           disbursed                         rate           grace,         All other        grace,         All other
                                              before                                       deferment (%)    periods (%)    deferment (%)    periods (%)
--------------------------------------------------------------------------------------------------------------------------------------------------------
10/1/1992...............................        7/1/1994            9.00            0.98            3.10            3.10            4.08            4.08
7/1/1994................................            7/1/            9.00            0.98            3.10            3.10            4.08            4.08
                                            1994[dagger]
7/1/1994................................        7/1/1995            8.25            0.98            3.10            3.10            4.08            4.08
7/1/1995................................        7/1/1998            8.25            0.98            2.50            3.10            3.48            4.08
7/1/1998................................        7/1/2006            8.25            0.98            1.70            2.30            2.68            3.28
--------------------------------------------------------------------------------------------------------------------------------------------------------


    Note: The FFEL Program loans represented in the first row in 
Chart 2 were only made to ``new borrowers'' on or after October 1, 
1992. The FFEL Program loans represented in the second row in Chart 
2 were only made to ``new borrowers'' on or after July 1, 1994. The 
FFEL Program loans represented in the third row in Chart 2 must--in 
addition to having been first disbursed on or after July 1, 1994, 
and before July 1, 1995--have been made for a period of enrollment 
that began on or included July 1, 1994.


          Chart 3--Variable-Rate Federal PLUS, SLS, and Consolidation Loans Interest Rates in Effect for the Period 7/1/2017 Through 6/30/2018
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                      Cohort                                                        Index rate
                                         --------------------------------                ---------------------------------------------------------------
                                                                                                              1-Year
                Loan type                      First           First       Max. rate (%)   91-Day T-bill     constant
                                           disbursed on      disbursed                         rate          Treasury       Margin (%)    Total rate (%)
                                             or after         before                                       maturity (%)
--------------------------------------------------------------------------------------------------------------------------------------------------------
PLUS and SLS............................              --       10/1/1992           12.00              --            1.22            3.25            4.47
SLS.....................................       10/1/1992            7/1/           11.00              --            1.22            3.10            4.32
                                                            1994[dagger]
PLUS....................................       10/1/1992        7/1/1994           10.00              --            1.22            3.10            4.32
PLUS....................................        7/1/1994        7/1/1998            9.00              --            1.22            3.10            4.32
PLUS....................................        7/1/1998        7/1/2006            9.00            0.98              --            3.10            4.08
Loan type...............................    Application     Application      Max. rate     91-Day T-bill  Average of the      Margin        Total rate
                                          received on or     received                          rate            Bond
                                               after          before                                        equivalent
                                                                                                           rates of the
                                                                                                           91-Day T-bill
                                                                                                              for the
                                                                                                           quarter prior
                                                                                                             to July 1
Consolidation...........................      11/13/1997       10/1/1998            8.25            0.98              --            3.10            4.08
HHS Portion of Consolidation............      11/13/1997              --              --              --            0.92            3.00            3.92
--------------------------------------------------------------------------------------------------------------------------------------------------------

    The last row in Chart 3 refers to portions of Federal Consolidation 
Loans attributable to loans made by the U.S. Department of Health and 
Human Services under subpart I of part A of title VII of the Public 
Health Service Act.

    Note: No new loans have been made under the FFEL Program since 
June 30, 2010.

    Electronic Access to This Document: The official version of this 
document is the document published in the Federal Register. Free 
internet access to the official edition of the Federal Register and the 
Code of Federal Regulations is available via the Federal Digital System 
at: www.gpo.gov/fdsys. At this site, you can view this document, as 
well as all other documents of this Department published in the Federal 
Register, in text or Adobe Portable Document Format (PDF). To use PDF 
you must have Adobe Acrobat Reader, which is available free at the 
site. You may also access documents of the Department published in the 
Federal Register by using the article search feature at: 
www.federalregister.gov. Specifically, through the advanced search 
feature at this site, you can limit your search to documents published 
by the Department.
    Program Authority: 20 U.S.C. 1071 et seq.

    Dated: August 14, 2017.
A. Wayne Johnson,
Chief Operating Officer, Federal Student Aid.
[FR Doc. 2017-17424 Filed 8-16-17; 8:45 am]
BILLING CODE 4000-01-P


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