Senate approves bipartisan student loan deal

The United States Senate approved a bipartisan deal Wednesday to reverse the recent spike in interest rates on federal student loans.

The bill, which would tie interest rates to the government's borrowing costs, passed in an 81-18 vote and now heads to the House, which hopes to approve the deal before lawmakers recess in early August.

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President Barack Obama and Education Secretary Arne Duncan have signaled their support.

The deal, finalized last week, offers students lower interest rates on federal student loans through the 2015 academic year.

After that, rates could reach as high as 8.25 percent for undergraduate students, 9.5 percent for graduate students and 10.5 percent for parents under the agreement.

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Interest rates on federal student loans doubled to 6.8 percent on July 1 after lawmakers couldn't agree on a fix, and the Senate had been deadlocked on a bill to deal with the issue until recently.

Reports first surfaced two weeks ago that a deal was close, though those talks hit a snag when initial cost estimates came in too high.