| There are some major changes in the federal student aid program starting this week that will lessen interest rates for some students while increasing the amount they can borrow.
The biggest change, the interest rate on new, subsidized Stafford loans to undergraduates drops from 6.8 percent to 6 percent.
Subsidized Stafford loans are awarded to lower-income students.
The government picks up interest payments while students are still in school.
The rates of the loans will continue to decline in stages over the next five years.
Earlier this year, responding to the credit crunch, Congress also approved a $2,000-per-year increase in what students can borrow from unsubsidized Stafford loans, regardless of income.
Borrowers with older, variable-rate Stafford or PLUS loans that they have not yet consolidated will see their rates drop by 3 percentage points.
The new rates could save the average Stafford borrower between $2,000 and $3,000 over the course of a 15-year repayment.
Maximum federal Pell Grants â the main direct-aid program for low-income college students â officially goes up to about $4,730 per student.
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