Washington ( CNN ) -- A Democratic measure to temporarily reverse the doubling of interest rates on millions of government-backed student loans fell short in the U.S. Senate on Wednesday , but there was hope a bipartisan deal would be struck soon to remedy the situation . `` We 're trying to find some common ground , '' said Sen. Richard Durbin of Illinois , the No . 2 Democratic leader who spearheaded fresh talks on the dispute . `` We do n't have an agreement and I ca n't say when or if we 'll come together . '' Sen. Richard Burr of North Carolina , a GOP member of the group seeking a deal , believes there are some options that `` seem to pique a lot of interest in a bipartisan way . '' Democrats needed the support of 60 senators in a test vote on a proposal backed by the White House to temporarily return rates for subsidized , need-based Stafford loans to 3.4 % to give lawmakers more time to work out a long-term fix for a number of higher education affordability issues . It never had much of a chance because all 46 Republicans opposed it as did some Democrats and was easily defeated . Interest rates on the subsidized financing for low-income students doubled on July 1 because of congressional inaction to hold them steady heading into the next school year . Far more students take out unsubsidized student loans from the government -- those rates have been at 6.8 % since 2007 . Student loan debt has skyrocketed in recent years , as have delinquencies , making it a pressing political and financial issue for millions of Americans . Many young graduates are deep in debt and without jobs . Student loan debt is second only to mortgages as the largest debt that consumers carry . For the class of 2013 , much of the debt is in government loans with graduates owing an average of $ 26,000 , according to a Fidelity survey of 750 college graduates . The new rates apply for loans beginning after July 1 . Opponents of the Senate Democratic remedy said it would have just deferred hard decisions and kept rates low for a short time . They prefer a permanent change to how interest rates are calculated for the millions of undergraduates , graduate students , and parents who take out government loans each year . Bipartisan talks were triggered after top White House officials , including Chief of Staff Denis McDonough and Education Secretary Arne Duncan , met with Senate Majority Leader Harry Reid and other Democratic leaders Tuesday night . Negotiations are aimed at sifting through the various proposals for interest rates , surcharges , and whether to mandate a cap on how high rates could rise , a key demand from Democrats . `` These things move in tandem , '' explained Durbin . `` As you lower the cap you raise the rates . And vice versa . As you raise the cap you lower the rates . So we 're trying to find the right spot that works for everyone and we 're still working on it . '' Sen. Tom Carper , another member of the bipartisan group , said Republicans appeared ready to compromise by accepting a rate cap . `` There is a good spirit and I think the interest is in finding a way to yes , '' the Delaware Democrat said . House Republicans , who prefer that markets set rates , pushed through a measure in May that ties rates to the bond market and caps them at 8.5 % . This summer 's fight is similar to the one that took place last year when Congress acted to avert an increase in the middle of a presidential campaign .
Student loan spending is high , with much of it in government loans . Rates doubled to 50 % on Stafford loans on because of congressional inaction . Senate Democrats sought to prevent the doubling of student loan rates . NEW : Lawmakers hope bipartisan efforts will lead to resolution of the issue soon .