Lawmakers voted 215-195 to approve the bill on Friday. But many students say they recognize the political battle is far from over.
Republicans and Democrats agree now isn't the time to raise the student rates on federal loans, but they can't agree on how to stop that from happening.
Lawmakers are battling over how to pay for the $5.9 billion legislation that would prevent interest rates for subsidized Stafford loans from doubling from 3.4 percent to 6.8 percent.
Democrats don't like it because the money to pay for it would come from President Obama's health care law and would eliminate a fund that pays for preventive care.
"A quality education is elemental not just to their individual futures, but to the future of the American economy," said White House spokesman Jay Carney.
Senate Democrats vow to block this legislation, saying they want the money to come from raising taxes on the wealthy and erasing subsidies to oil and gas companies.
Mr. Obama has been on the road going to several school campuses blaming Republicans. Republicans say Democrats are making a war where there is none.
"To travel to three battleground states and go to three large college campuses on taxpayer's money to try to make this a political issue is pathetic," said House Speaker John Boehner.
Lawmakers are not the only ones with vested interest in this legislation - students say they just don't want to be buried in debt when they graduate. Many say the cost of education is already high, so a spike in interest rates would be crippling to college graduates.
"It's just hard. I'm a dental student at UCLA, and I mean, school is expensive as it is already, and you're trying to go into a field where you can help people in the future, but then they keep raising the money that we're going to be having to be paying back so who knows how many years it will take to even pay back those loans?" said UCLA student Katy Rosen.
The White House has said that if the bill reaches Mr. Obama's desk, senior advisers would recommend the president veto it because of its cuts to the health care fund.
If Republicans and Democrats do not come to an agreement on how to halt the interest rate, it will spike to 6.8 percent by July.
The higher interest rates, if triggered, would affect the 7.4 million undergraduates expected to borrow new Stafford loans beginning July 1. This year, 8 million students took out such loans, averaging $3,568, according to the Education Department. Those who had student loans prior to July 1 would not be affected.
The Associated Press contributed to this report.