Student Loan Interest Rates: Federal, Private, Refinancing

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If you have begun repayment of your federal student loans, their interest rates have been set to 0% until Sept. 30, 2021, and no payment is due before then.

If you are still borrowing for your education, the federal student loan interest rate for undergraduates is 3.73% for the 2021-22 school year. Federal rates for unsubsidized graduate student loans and parent loans are higher — 5.28% and 6.28%, respectively. The rates for this coming year go into effect on July 1.

Private student loan interest rates can sometimes be lower than federal rates, but approval for the lowest rates requires excellent credit. If you have good credit, you may be able to refinance existing student loans to get a lower rate.

» MORE: How to calculate student loan interest

Current student loan interest rates

Refinance student loans
Fixed	2.95% to 9.15%
Variable	1.90% to 8.95%
Private student loans
Fixed	3.34% to 14.99%
Variable	1.04% to 12.94%
Federal student loans (fixed)
Undergraduate	3.73%
Graduate	5.28%
PLUS (Parent, Grad)	6.28%

Rates updated monthly.

Federal student loan interest rates are increasing for the 2021-22 school year and apply to loans disbursed between July 1, 2021, and July 1, 2022. The interest rates for all new federal direct undergraduate student loans are increasing to 3.73%, up from 2.75% in 2020-21. Unsubsidized direct graduate student loan rates are increasing to 5.28%, up from 4.30%. Rates for PLUS loans, which are for graduate students and parents, are increasing to 6.28%, up from 5.30%.

Federal student loan interest rates by year

To apply for federal student loans, as well as grants and work-study, fill out the Free Application for Federal Student Aid — this can help. Any student, regardless of their financial need, typically qualifies for unsubsidized student loans, and students with a financial need may qualify for subsidized loans. Subsidized loans are a better deal because the government pays the interest that accrues while you’re in school.

Federal student loan fees are taken as a percentage of the total loan amount and deducted proportionally from each loan disbursement, meaning you'll receive slightly less than the amount you borrow.

Academic year	Undergraduate	Graduate	Parent PLUS, Grad PLUS
2021-22	3.73% interest	5.28% interest	6.28% interest
2020-21	2.75% interest 1.06% fee	4.30% interest 1.06% fee	5.30% interest 4.24% fee
2019-20	4.53% interest 1.06% fee	6.08% interest 1.06% fee	7.08% interest 4.24% fee
2018-19	5.05% interest 1.06% fee	6.60% interest 1.06% fee	7.60% interest 4.25% fee
2017-18	4.45% interest 1.07% fee	6.00% interest 1.07% fee	7.00% interest 4.26% fee
2016-17	3.76% interest 1.07% fee	5.31% interest 1.07% fee	6.31% interest 4.28% fee
2015-16	4.29% interest 1.07% fee	5.84% interest 1.07% fee	6.84% interest 4.27% fee
2014-15	4.66% interest 1.07% fee	6.21% interest 1.07% fee	7.21% interest 4.29% fee

Source: U.S. Department of Education, Federal Student Aid Interest rates effective July 1 of each year. Loan fees effective October 1 of each year.

Private student loan interest rates by lender

It’s generally best to max out your federal student loan options before taking out a private student loan. If you need one, shop around first to ensure you get the lowest rate you qualify for. If you don’t meet a lender’s credit requirements, you can apply with a co-signer who does.

Current private student loan interest rates, updated monthly:

Lender	Fixed APR ranges*	Get started
	Fixed: 3.34% - 14.51%	Check rates
	Fixed: 3.34% - 12.99%	Check rates
	Fixed: 3.34% - 12.78%	Check rates
	Fixed: 4.25% - 12.59%	Check rates
	Fixed: 4.23% - 11.26%	Check rates
Compare rates for multiple private student loans. Check Rates

Student loan refinancing rates by lender

Consider student loan refinancing if your credit score is at least in the high 600s, you have enough income to afford your debts and other expenses, and you’re comfortable giving up federal benefits like income-driven repayment and Public Service Loan Forgiveness. Before refinancing, shop around to find the lowest rate you qualify for.

Current student loan refinancing rates, updated monthly:

Lender	APR	Get started
	Fixed: 2.5% - 5.79% Variable: 1.88% - 5.64%	Check rates
	Fixed: 2.74% - 6.74% Variable: 2.25% - 6.39%	Check rates
	Fixed: 2.98% - 5.79% Variable: 1.99% - 5.61%	Check rates
	Fixed: 2.58% - 5.99% Variable: 2.39% - 6.01%	Check rates
	Fixed: 2.95% - 7.63% Variable: 1.9% - 5.25%	Check rates
	Fixed: 2.5% - 6% Variable: 1.89% - 5.9%	Check rates
	Fixed: 2.89% - 5.63% Variable: 2.13% - 5.25%	Check rates
	Fixed: 2.69% - 9.15% Variable: 2.24% - 8.9%	Check rates
Ready to compare all your student loan refinancing options?

Average student loan interest rate

The average student loan interest rate is 5.8% among all households with student debt, according to a 2017 report by New America, a nonprofit, nonpartisan think tank. That includes both federal and private student loans — about 90% of all student debt is federal.

With a 5.8% interest rate on $30,000 of student loans, a borrower would pay about $9,600 in interest throughout 10 years.

The average student loan interest rate is higher among some groups, according to the report. For instance, the average rate is 6.3% among households where the borrower didn’t complete a college degree, and 6.6% among households with incomes less than $24,000.

If you have multiple student loans with different rates, the weighted average interest rate is the rate you'll have if you consolidate the loans through the federal government. Federal consolidation won't lower your average interest rate, but refinancing with a private lender could.

» MORE: 7 ways to get the lowest student loan interest rate

Student loan interest rate calculator

How student loan interest rates work

Student loan interest rates work differently, depending on whether the loan is federal or private. For federal loans, every borrower taking out the same type of federal loan in a given year has the same interest rate. For private loans, borrowers with higher credit scores generally qualify for lower rates and borrowers with lower credit scores get higher rates.

Federal student loans:

Congress sets interest rates yearly based on the 10-year Treasury note
Most have fees charged as a percentage of the total loan amount
Rates are fixed for the life of the loan

Private student loans:

Interest rates are typically credit-based
Most private lenders don't charge origination fees
Borrowers can choose either a fixed or variable interest rate
Variable rates are subject to change monthly or quarterly

» MORE: How Fed rate changes affect student loans

Tips for repaying student loan interest

Student loan interest accrues while you’re in school — unless you have subsidized federal loans — so you’ll owe more than you initially borrowed when you enter repayment. You can save on interest by:

Paying off interest before your grace period ends. When your student loans enter repayment, the unpaid interest will be capitalized, or added to your principal balance. Avoid costly interest capitalization by making monthly interest-only payments or paying a fixed amount — say, $25 — while you’re in school. Alternatively, pay off the interest during your grace period using graduation money or income from your first post-college job.
Avoiding income-driven repayment, if possible. Federal income-driven repayment plans can keep cash-strapped borrowers out of default, but they also cost borrowers more interest in the long run. If you can afford to make federal loan payments on the standard, 10-year repayment plan, do it.
Watching your overall financial health. Although you’ll save the most in student loan interest by paying off the loan as soon as possible, other financial goals are higher priority. Before paying extra on student debt, build an emergency fund, contribute to a 401(k) or IRA, and pay off high-interest debt such as credit cards.

Key terms in this story

Fixed interest: An interest rate that does not change during the life of a loan. All federal student loans have fixed interest rates, but private loans can offer fixed or variable interest rates. Fixed interest is the safer option because you don’t have to worry about your rate — and payment — increasing.

Variable interest: Variable interest rates can change monthly or quarterly depending on the loan contract and come with rates caps as high as 25%. Variable interest loans are riskier than fixed interest loans, but can save you money if the timing is right.

Private student loan: Education funding from banks, credit unions and online lenders instead of the federal government. Private loans are best used to fill funding gaps after maxing out federal loans.

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Current Student Loan Interest Rates and How They Work