We believe everyone should be able to make financial decisions with confidence. And while our site doesn’t feature every company or financial product available on the market, we’re proud that the guidance we offer, the information we provide and the tools we create are objective, independent, straightforward — and free.
So how do we make money? Our partners compensate us. This may influence which products we review and write about (and where those products appear on the site), but it in no way affects our recommendations or advice, which are grounded in thousands of hours of research. Our partners cannot pay us to guarantee favorable reviews of their products or services. Here is a list of our partners.
Current Student Loan Interest Rates and How They Work
The federal student loan interest rate for undergraduates in 2025-26 is 6.39%.
Many, or all, of the products featured on this page are from our advertising partners who compensate us when you take certain actions on our website or click to take an action on their website. However, this does not influence our evaluations. Our opinions are our own. Here is a list of our partners and here's how we make money.
Updated · 3 min read
How is this page expert verified?
NerdWallet's content is fact-checked for accuracy, timeliness and relevance. It undergoes a thorough review process involving writers and editors to ensure the information is as clear and complete as possible.
Eliza Haverstock is NerdWallet's higher education writer, where she covers all aspects of college affordability and student loans. Previously, she reported on billionaires and investing for Forbes in New York, and she also covered private markets for PitchBook in Seattle. Eliza got started at her college newspaper at the University of Virginia and interned for Bloomberg, where she spent a summer writing a feature story about plastic straws. She is based in Washington, D.C.
Kim Lowe is Head of Content for NerdWallet's Personal and Student Loans team. She joined NerdWallet in 2016 after 15 years at MSN.com, where she held various content roles including editor-in-chief of the health and food sections. Kim started her career as a writer for print and web publications that covered the mortgage, supermarket and restaurant industries. Kim earned a bachelor's degree in journalism from the University of Iowa and a Master of Business Administration from the University of Washington. She works from her home near Portland, Oregon.
Lisa Mulka is a freelance writer specializing in personal finance content. With more than 15 years of writing experience, Lisa most recently authored a book on personal financial literacy and served as lead writer on the FDIC’s Money Smart for Young People program. She holds a bachelor’s in creative writing, and master’s degrees in written communication and in educational technology. Lisa lives with her husband and two children in Michigan, where she spends her free time teaching the next generation of writers at Johns Hopkins University Center for Talented Youth.
Contributing Writer
The federal student loan interest rate for undergraduates is 6.39% for new loans taken out for the 2025-26 school year, effective from July 1, 2025, to June 30, 2026. Federal rates for graduate student loans and PLUS loans are higher — 7.94% and 8.94%, respectively.
Private student loan interest rates can sometimes be lower than federal rates, but approval for the lowest rates requires excellent credit (scores above 689). Private loans originate from banks, credit unions or schools instead of the federal government. Private loans are best used to fill funding gaps after maxing out federal loans.
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. All federal student loans have fixed interest rates, which means the interest rate does not change during the life of the loan.
In addition to interest rates, federal student loans also come with fees. These 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.
Student loan rates over time:
Academic year
Undergraduate
Graduate
Parent PLUS, Grad PLUS
2025-26
6.39%
7.94%
8.94%
2024-25
6.53%
8.08%
9.08%
2023-24
5.50%
7.05%
8.05%
2022-23
4.99%
6.54%
7.54%
2021-22
3.73%
5.28%
6.28%
2020-21
2.75%
4.30%
5.30%
2019-20
4.53%
6.08%
7.08%
2018-19
5.05%
6.60%
7.60%
2017-18
4.45%
6.00%
7.00%
2016-17
3.76%
5.31%
6.31%
2015-16
4.29%
5.84%
6.84%
2014-15
4.66%
6.21%
7.21%
Source: U.S. Department of Education, Federal Student AidInterest rates effective July 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.
Private loans can have fixed or variable interest rates. Variable interest rates can change monthly, quarterly or annually depending on the loan contract. Fixed interest is the safer option because you don’t have to worry about your rate — and payment — increasing.
NerdWallet's ratings are determined by our editorial team. The scoring formula incorporates coverage options, customer experience, customizability, cost and more.
5.0
NerdWallet rating
NerdWallet's ratings are determined by our editorial team. The scoring formula incorporates coverage options, customer experience, customizability, cost and more.
NerdWallet's ratings are determined by our editorial team. The scoring formula incorporates coverage options, customer experience, customizability, cost and more.
4.5
NerdWallet rating
NerdWallet's ratings are determined by our editorial team. The scoring formula incorporates coverage options, customer experience, customizability, cost and more.
NerdWallet's ratings are determined by our editorial team. The scoring formula incorporates coverage options, customer experience, customizability, cost and more.
5.0
NerdWallet rating
NerdWallet's ratings are determined by our editorial team. The scoring formula incorporates coverage options, customer experience, customizability, cost and more.
NerdWallet's ratings are determined by our editorial team. The scoring formula incorporates coverage options, customer experience, customizability, cost and more.
5.0
NerdWallet rating
NerdWallet's ratings are determined by our editorial team. The scoring formula incorporates coverage options, customer experience, customizability, cost and more.
NerdWallet's ratings are determined by our editorial team. The scoring formula incorporates coverage options, customer experience, customizability, cost and more.
4.5
NerdWallet rating
NerdWallet's ratings are determined by our editorial team. The scoring formula incorporates coverage options, customer experience, customizability, cost and more.
NerdWallet's ratings are determined by our editorial team. The scoring formula incorporates coverage options, customer experience, customizability, cost and more.
5.0
NerdWallet rating
NerdWallet's ratings are determined by our editorial team. The scoring formula incorporates coverage options, customer experience, customizability, cost and more.
NerdWallet's ratings are determined by our editorial team. The scoring formula incorporates coverage options, customer experience, customizability, cost and more.
4.0
NerdWallet rating
NerdWallet's ratings are determined by our editorial team. The scoring formula incorporates coverage options, customer experience, customizability, cost and more.
NerdWallet's ratings are determined by our editorial team. The scoring formula incorporates coverage options, customer experience, customizability, cost and more.
5.0
NerdWallet rating
NerdWallet's ratings are determined by our editorial team. The scoring formula incorporates coverage options, customer experience, customizability, cost and more.
NerdWallet's ratings are determined by our editorial team. The scoring formula incorporates coverage options, customer experience, customizability, cost and more.
4.0
NerdWallet rating
NerdWallet's ratings are determined by our editorial team. The scoring formula incorporates coverage options, customer experience, customizability, cost and more.
NerdWallet's ratings are determined by our editorial team. The scoring formula incorporates coverage options, customer experience, customizability, cost and more.
5.0
NerdWallet rating
NerdWallet's ratings are determined by our editorial team. The scoring formula incorporates coverage options, customer experience, customizability, cost and more.
NerdWallet's ratings are determined by our editorial team. The scoring formula incorporates coverage options, customer experience, customizability, cost and more.
4.5
NerdWallet rating
NerdWallet's ratings are determined by our editorial team. The scoring formula incorporates coverage options, customer experience, customizability, cost and more.
NerdWallet's ratings are determined by our editorial team. The scoring formula incorporates coverage options, customer experience, customizability, cost and more.
4.5
NerdWallet rating
NerdWallet's ratings are determined by our editorial team. The scoring formula incorporates coverage options, customer experience, customizability, cost and more.
NerdWallet's ratings are determined by our editorial team. The scoring formula incorporates coverage options, customer experience, customizability, cost and more.
4.5
NerdWallet rating
NerdWallet's ratings are determined by our editorial team. The scoring formula incorporates coverage options, customer experience, customizability, cost and more.
NerdWallet's ratings are determined by our editorial team. The scoring formula incorporates coverage options, customer experience, customizability, cost and more.
4.5
NerdWallet rating
NerdWallet's ratings are determined by our editorial team. The scoring formula incorporates coverage options, customer experience, customizability, cost and more.
NerdWallet's ratings are determined by our editorial team. The scoring formula incorporates coverage options, customer experience, customizability, cost and more.
4.0
NerdWallet rating
NerdWallet's ratings are determined by our editorial team. The scoring formula incorporates coverage options, customer experience, customizability, cost and more.
NerdWallet's ratings are determined by our editorial team. The scoring formula incorporates coverage options, customer experience, customizability, cost and more.
5.0
NerdWallet rating
NerdWallet's ratings are determined by our editorial team. The scoring formula incorporates coverage options, customer experience, customizability, cost and more.
NerdWallet's ratings are determined by our editorial team. The scoring formula incorporates coverage options, customer experience, customizability, cost and more.
5.0
NerdWallet rating
NerdWallet's ratings are determined by our editorial team. The scoring formula incorporates coverage options, customer experience, customizability, cost and more.
NerdWallet's ratings are determined by our editorial team. The scoring formula incorporates coverage options, customer experience, customizability, cost and more.
5.0
NerdWallet rating
NerdWallet's ratings are determined by our editorial team. The scoring formula incorporates coverage options, customer experience, customizability, cost and more.
NerdWallet's ratings are determined by our editorial team. The scoring formula incorporates coverage options, customer experience, customizability, cost and more.
4.5
NerdWallet rating
NerdWallet's ratings are determined by our editorial team. The scoring formula incorporates coverage options, customer experience, customizability, cost and more.
NerdWallet's ratings are determined by our editorial team. The scoring formula incorporates coverage options, customer experience, customizability, cost and more.
5.0
NerdWallet rating
NerdWallet's ratings are determined by our editorial team. The scoring formula incorporates coverage options, customer experience, customizability, cost and more.
NerdWallet's ratings are determined by our editorial team. The scoring formula incorporates coverage options, customer experience, customizability, cost and more.
4.0
NerdWallet rating
NerdWallet's ratings are determined by our editorial team. The scoring formula incorporates coverage options, customer experience, customizability, cost and more.
Consider student loan refinancing if you have private student loans and can qualify for a lower rate than your current rate. You can also refinance federal loans in order to get a lower rate; however, you’ll give up benefits like income-driven repayment and Public Service Loan Forgiveness.
Current student loan refinancing rates:
Lender
APR
SoFi Student Loan Refinancing
Fixed: 4.49% - 9.99%
Variable: 5.99% - 9.99%
Earnest
Fixed: 3.95% - 10.49%
Variable: 5.88% - 10.49%
Splash
Fixed: 5.44% - 8.44%
Variable: 4.86% - 10.74%
LendKey
Fixed:4.89% - 9.04%
Variable:5.54% - 9.12%
Education Loan Finance
Fixed: 4.88% - 8.44%
Variable: 4.86% - 8.24%
Nerdy Perspective
Even if you can get a lower rate with a private lender, I always recommend federal student loans first. The government offers flexible repayment plans based on your income, borrower protections, loan forgiveness programs and payment pauses. You won’t find most of these benefits with private lenders. If you’ve borrowed as much as you can in federal loans and you still have leftover college costs, then you can start to think about private options.
Eliza Haverstock
Lead Writer, Student Loans
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, while borrowers with lower credit scores get higher rates.
The average student loan interest rate is 6.87% among all households with student debt, according to the Education Data Initiative, an organization that collects statistics on the U.S. education system. That includes both federal andprivate student loans — 94.81% of all student debt is federal.
With a 6.87% interest rate on $30,000 of student loans, a borrower would pay about $11,500 in interest over 10 years.
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.
Lowering your student loan interest rate can help decrease the total amount you pay over the life of a loan. Two options for lowering your interest rate are refinancing and automating payments.
If you have good credit, you may be able to refinance existing student loans to get a lower rate. Keep in mind that you'll lose access to borrower protections like income-driven repayment plans and loan forgiveness programs if you refinance your federal loans with a private lender.
Switching to autopay for federal student loans will save 0.25% on your interest rate. Many private lenders also offer a 0.25% discount for automating payment.
Complete the FAFSA. To apply for federal student loans, as well as grants and work-study, fill out the Free Application for Federal Student Aid — our FAFSA guide can help.
Determine how much to borrow. While you may be able to take out multiple federal loans, there are maximum limits based on loan types and the total amount you can borrow throughout your education.
Supplement with private. After exhausting federal student loan options, consider private lenders to fill in any funding gaps.
How to pay interest on student loans
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:
Pay off interest before your grace period ends. When your student loans enter repayment, the unpaid interest may 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.
Avoid 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.
Watch 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.
