Elizabeth Warren

Republicans in the Senate on Wednesday voted against allowing people to refinance student loans to a lower rate, legislation that had been introduced by Massachusetts Democrat Elizabeth Warren.

U.S. student debt rose to an unprecedented $1.1 trillion for the first quarter of 2014, and some people are paying interest rates near 7 percent, well above prevailing market interest rates.

Nearly 70 percent of debt belonging to 25-year-olds comes from their student loans, which continued to increase in 2013. The average student loan balance rose to $20,926.

"With this vote we show the American people who we work for in the United States Senate: billionaires or students," Warren, who sponsored the legislation, was quoted as saying by the Associated Press after the vote that shut down any further debate on it. "A vote on this legislation is a vote to give millions of young people a fair shot at building their future."

Earlier this week, President Barack Obama unveiled his proposals to help ease the financial burden on Americans saddled with record student debt, including an income-adjusted monthly payment cap.

At that time, the president also urged Republicans in Congress to act on the Democratic-sponsored bills.

On Wednesday, Republicans showed no signs of heeding the president’s call. "The Senate Democrats' bill isn't really about students at all. It's really all about Senate Democrats," Minority Leader Mitch McConnell (R-Ky.), said. "They want an issue to campaign on to save their own hides this November."

During a press conference at the White House on Monday, the president also vowed to renegotiate student loan terms with student lender SLM Corp. (NASDAQ:SLM), more commonly referred to as Sallie Mae, and to work with professional and nonprofit groups like teachers' associations and the YMCA, to help educate student loan debtors about their options.