After a series of delays, the Senate passed legislation Wednesday to fundamentally restructure government student loans and reverse the sharp hikes in interest rates that went into effect on July 1.

The vote was 81-18, with more than a dozen Democrats voting against the White House-backed plan.

The compromise proposal, which would link interest rates to market prices, was vehemently opposed by liberal Democrats who maintain that its provisions are unfair.

In a statement, President Barack Obama lauded the legislation as "a major victory for our nation’s students."

"It meets the key principles I laid out from the start," he said. "It locks in low rates next year, and it doesn’t overcharge students to pay down the deficit. "

But some Democrats like Sen. Elizabeth Warren, D-Mass., argued that the plan – which would reduce current interest rates from 6.8 percent to 3.86 percent – burdens students because those rates could still fluctuate as high as 10.5 percent in some cases.

"Students -- all students -- will end up paying far higher interest rates on their loans than they do right now," Warren said earlier Wednesday on the Senate floor.

"The White House is being disingenuous and is trying to sweep under the rug big increases in interest rates for students and parents in the near future," Sen. Bernie Sanders, D-Vt., said in a statement on Tuesday.

Sanders - who offered his own amendment to the proposal but failed to garner enough votes -- labeled the Senate plan "dangerous."

The Senate previously considered a 1-year extension of those rates, which would have pushed the broader problem off for another year. But that plan didn't have 60 votes to pass.

Instead, a bipartisan group of senators -- including Sen. Joe Manchin, D-W. Va., and Lamar Alexander, R-Tenn., among others -- negotiated what they say is a permanent fix.

That plan would lower interest rates in back down in the short term. And it would cap interest rates in the long term, a provision that Democrats like Warren demanded.

But the caps are at levels much higher than current rates. Undergraduates would pay a maximum of 8.25 percent, while graduate students would pay 9.5 percent. Parents who take out loans for their children could see rates as high as 10.5 percent.

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