SLASH Act

Student Loan Accrual Support and Help Act or the SLASH Act

This bill sets the annual interest rate on all Federal Direct Stafford Loans, Federal Direct Unsubsidized Stafford Loans, and Federal Direct PLUS Loans disbursed on or after July 1, 2020, at an amount equal to the lesser of (1) the high-yield 10-year Treasury notes, or (2) 5%.

The bill also revises the method for calculating the applicable interest rate on a Federal Direct Consolidation Loan.

It also fixes the interest rate on such loans for the period of the loan.

[Congressional Bills 116th Congress]
[From the U.S. Government Publishing Office]
[H.R. 3793 Introduced in House (IH)]

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116th CONGRESS
  1st Session
                                H. R. 3793

  To amend the Higher Education Act of 1965 to include interest rate 
      provisions for Federal loans made on or after July 1, 2020.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                             July 17, 2019

Ms. Kendra S. Horn of Oklahoma introduced the following bill; which was 
            referred to the Committee on Education and Labor

_______________________________________________________________________

                                 A BILL


 
  To amend the Higher Education Act of 1965 to include interest rate 
      provisions for Federal loans made on or after July 1, 2020.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Student Loan Accrual Support and 
Help Act'' or the ``SLASH Act''.

SEC. 2. FEDERAL STUDENT LOAN INTEREST RATES.

    Section 455(b) of the Higher Education Act of 1965 (20 U.S.C. 
1087e(b)) is amended--
            (1) in the header of paragraph (8), by inserting ``, and 
        before July 1, 2020'' after ``July 1, 2013'';
            (2) in subparagraphs (A), (B), (C), and (D) of paragraph 
        (8), by inserting ``and before July 1, 2020,'' after ``July 1, 
        2013,'' each place it appears;
            (3) by redesignating paragraphs (9) and (10) as paragraphs 
        (10) and (11), respectively; and
            (4) by inserting at the end of paragraph (8) the following 
        new paragraph:
            ``(9) Interest rate provisions for new loans on or after 
        july 1, 2020.--
                    ``(A) Rate for all new federal direct loans.--
                Notwithstanding the preceding paragraphs of this 
                subsection, for Federal Direct Stafford Loans, Federal 
                Direct Unsubsidized Stafford Loans, and Federal Direct 
                PLUS Loans, for which the first disbursement is made on 
                or after July 1, 2020, the applicable rate of interest 
                shall, for loans disbursed during any 12-month period 
                beginning on July 1 and ending on June 30, be 
                determined on the preceding June 1 and be equal to the 
                lesser of--
                            ``(i) a rate equal to the high yield of the 
                        10-year Treasury note auctioned at the final 
                        auction held prior to such June 1; or
                            ``(ii) 5.0 percent,
                except that the applicable rate of interest for any 12-
                month period (beginning on July 1 and ending on June 
                30) shall not exceed the applicable rate of interest 
                for the preceding 12-month period by more than 0.5 
                percent.
                    ``(B) Consolidation loans.--Notwithstanding the 
                preceding paragraphs of this subsection, any Federal 
                Direct Consolidation Loan for which the application is 
                received on or after July 1, 2020, shall bear interest 
                at an annual rate on the unpaid principal balance of 
                the loan that is equal to the lesser of--
                            ``(i) the weighted average of the interest 
                        rates on the loans consolidated, rounded to the 
                        nearest higher one-eighth of one percent; or
                            ``(ii) the applicable rate of interest, as 
                        determined on the preceding June 1 in 
                        accordance with subparagraph (A), for Federal 
                        Direct Stafford Loans disbursed during the 12-
                        month period (beginning on July 1 and ending on 
                        June 30) during which the application for 
                        consolidation is received.
                    ``(C) Consultation.--The Secretary shall determine 
                the applicable rate of interest under subparagraph (A) 
                after consultation with the Secretary of the Treasury 
                and shall publish such rate in the Federal Register as 
                soon as practicable after the date of determination.
                    ``(D) Rate.--The applicable rate of interest 
                determined under this paragraph for a Federal Direct 
                Stafford Loan, a Federal Direct Unsubsidized Stafford 
                Loan, a Federal Direct PLUS Loan, or a Federal Direct 
                Consolidation Loan shall be fixed for the period of the 
                loan.''.
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