The Senate voted to tie student loan interest rates to financial markets Wednesday, a deal that would retroactively replace the doubled 6.8 percent rate that has been in effect throughout the month of July.

Rates on loans taken out by undergraduates after July 1 this year would be 3.9 percent, while graduate student loans would have an interest rate of 5.4 percent.

The deal, which passed with a vote of 81-18, drew strong support from Republicans but was opposed by some Democrats, with 17 voting against the bill.

The new plan replaces the fixed rate subsidized federal student loan program, and many Democrats objected to rates that could leave students vulnerable to market fluctuations.

Congress set a cap of 8.25 percent on undergraduate loans and 9.5 percent on graduate loans to account for changes in the market, though the Congressional Budget Office predicted rates would not reach these limits within the next 10 years.

Scott Fleming, Georgetown’s vice president for federal relations, was optimistic about the Senate deal.

“The good news is that this agreement means that in the first few years, interest rates will stay below the 6.8 percent level,” Fleming said, adding that the upcoming reauthorization of the Higher Education Act at the end of the year will provide an opportunity to reexamine loan rates. “As we move into that process, there will be an opportunity to look into it again to see how it can most constructively be configured.”

Georgetown University Student Association President Nate Tisa (SFS ’14), who led an advocacy campaign against rising rates throughout June, agreed that this Senate agreement should not be the last step.

“It’s clearly a compromise,” Tisa said. “There is a cap, like we were pushing for, but unfortunately the raw rate increase may hurt low-income students and their families.”

The bill is similar to proposals put forth by both the White House and House Republicans earlier this year, which both supported market-based student loan interest rates.

President Obama praised the Senate deal, stressing that it met two main goals of keeping rates low next year and not burdening students to pay the budget deficit.

“I urge the House to pass this bill so that I can sign it into law right away and I hope both parties build on this progress by taking even more steps to bring down soaring costs and keep a good education — a cornerstone of what it means to be middle class — within reach for working families,” Obama said in a White House press release.

Secretary of Education Arne Duncan echoed Obama’s statement.

“We look forward to continuing to work with Congress to figure out how we can significantly bring down the overall debt that students and families have to incur to go to college. Reaching this bipartisan compromise gives me hope that it will lead to many more,” Duncan said in a press release.