The Senate on Wednesday approved a bipartisan deal to lower interest rates on federal loans that hundreds of Northwestern students will likely take out this fall.

If passed by the House and signed by President Barack Obama, the bill will tie interest rates on federally subsidized Stafford loans to the financial markets, bringing them down to 3.86 percent for the 2013-14 academic year. The rate doubled from 3.4 percent to 6.8 percent on July 1, but the new rate will be retroactively applied to all loans taken out after the hike.

Wednesday’s agreement came after weeks of partisan dispute over the best way to prevent the July 1 increase from affecting the millions of American students using the loans each year. In the 2012-13 academic year, more than 2,500 undergraduate students at NU were on the loans, said Carolyn Lindley, University director of financial aid, earlier this month.

The bill passed Wednesday would bring down rates for the upcoming academic year, but by binding the rates to the market, some Democrats were concerned the deal would negatively impact lower- and middle-class students as the economy recovers.national economy continues its recovery. Just one Republican senator voted against the plan.

The compromise caps interest rates on the loans at 8.25 percent for undergraduate students.

— Cat Zakrzewski