The senators said the accord was a good compromise because, for the first time, subsidized and unsubsidized Stafford loans would be under the same interest rate, The Hill reported.
The rate on unsubsidized loans doubled on July 1 to 6.8 percent because Congress failed to address the loan rate issue.
"This isn't the agreement any of us would have written," Senate Majority Whip Dick Durbin, D-Ill., said. "We have come a long way in reaching common ground on a very, very difficult and challenging topic."
Sen. Tom Harkin, D-Iowa, chairman of the Senate Health, Education, Labor and Pensions Committee, called the deal a "great compromise," after initially leading an unsuccessful effort pushing a one-year freeze of the lower rates.
The new compromise would allow rates on new Stafford loans to adjust in accordance with financial markets, similar to plans advanced by House Republicans and the White House, The Hill said.
Speaker John Boehner, R-Ohio, said he hadn't seen the plan but sounded optimistic that the two chambers could strike a compromise.
"I haven't seen the details of it, but clearly, it follows the structure of the House bill," Boehner said during a media availability. "It's a market-based reform with market-based rates, similar to what the president called for and what the House has already passed. So when we see the details, I'm hopeful that we'll be able to put this issue behind us."
Senate Majority Leader Harry Reid said he hoped to consider the bill quickly before Congress breaks for the August recess.