The Obama Administration is pushing for legislation that would bring down student loan interest rates. (401(K)2013/Creative Commons)

On July 1 undergraduate rates doubled from 3.4 percent to 6.8 percent. Obama is advocating for legislation that would bring the undergraduate rate down to 3.86 percent.

On a conference call James Kvaal, Deputy Assistant to the President and Deputy Director of the Domestic Policy Council, said that this would provide "relief to 11 million borrowers," and "…cut rates on…loans." He also stated that this legislation would prevent undergraduate rates from going above 8.25 percent. 

The White House said that this "bipartisan compromise" would "save a typical undergraduate student in California $1,565 over the life of those loans." The White House added that there are 607,768 borrowers in California, who have borrowed an average of $7,032.

On the same conference call, Secretary of Education Arne Duncan said that the average borrower would save $1,500 under the new Legislation.

He also said the legislation and "This…debate is simply about the cost of debt, not the debt itself." He added that this is the "first step" and that when this is done, there will be a shift to "…larger, more complex issues."

Kvaal also said that this is a "…budget neutral approach…" and is "Really meaningful relief."

Secretary Duncan added, "…this is an important starting point…" and "…[the] bigger challenge…is the amount of debt itself…" He said that the rate decrease applies to Satfford Loans and not Perkins Loans. According to the Department of Education, the Federal Perkins Loan Program is for "needy students" and the student must attend "any one of approximately 1,700 participating postsecondary institutions" where the loan will come from. According to the Stafford Loan website, the loans are "made available to college and university students to supplement personal and family resources, scholarships, grants, and work-study." 

Duncan also said, "…graduate students will see a rate cut…" According to the White House, "…over one million GradPLUS and Parent PLUS borrowers will see their rates on new loans drop from 7.9 percent to 6.41 percent - the first reduction in years."

This legislation - a compromise between senators - is still in the Democratically controlled United States Senate. There was no mention during the conference call about how the Obama Administration will try to get this through the Republican controlled United States House of Representatives.

Reach Staff Reporter Max Schwartz here; follow him on Twitter here.