What is the Average Student Loan Interest Rate?

According to Federal Student Aid, the average student loan interest rate for the 2017-2018 school year was 4.45%.
This means that if you borrowed $10,000 for your education, you would owe approximately $11,133 when you begin repayment.

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Federal Student Loans

The average student loan interest rate for federal student loans is 4.53%. This is the rate for the 2019-2020 school year. Federal student loans are loans that are offered by the government to help students pay for college. The interest rate is set by the government and does not change.

Federal Direct Subsidized Loans

The Federal Direct Subsidized Loan is a need-based loan available to undergraduate and graduate students with financial need. The U.S. Department of Education pays the interest on Direct Subsidized Loans while the borrower is in school, during the grace period, and during periods of deferment or forbearance.

The interest rate for Federal Direct Subsidized Loans first disbursed between July 1, 2020 and June 30, 2021 is 2.75%.

Federal Direct Unsubsidized Loans

The interest rate for Federal Direct Unsubsidized Loans first disbursed on or after July 1, 2020, and before July 1, 2021, is 2.75% for undergraduate students. The interest rate for graduate and professional students is 4.30%. These rates are fixed for the life of the loan.

All Direct Loans first disbursed on or after July 1, 2006, are eligible for interest rate reduction if the borrower signs up for automatic payments (through authorized debit from a bank account) while in their grace period or during repayment. For Direct Subsidized and Unsubsidized Loans first disbursed prior to July 1, 2006, a .25% interest rate reduction is available if the borrower signs up for automatic debit payments within 60 days of the first payment due date.

Federal Direct PLUS Loans

If you’re a parent or graduate student, you can get a Direct PLUS Loan to help pay for education expenses. The interest rate for PLUS Loans first disbursed on or after July 1, 2019, and before July 1, 2020, is 7.08%. However, there’s an additional 4.236% fee for these loans. So, the total interest rate would be 11.316%. Your school will give you information on how to apply for a PLUS Loan.

Private Student Loans

If you’re looking to take out a private student loan, you’ll want to know what the average student loan interest rate is. The average student loan interest rate for private loans is _____. This is the average rate for all private student loan lenders.

Fixed-Rate Student Loans

If you’re taking out private student loans, you might find loans with a fixed interest rate more appealing. A fixed-rate loan means that your interest rate will stay the same for the life of the loan. That gives you predictability in your monthly payments, which can make it easier to budget. You’ll know exactly how much your monthly payment will be and how long it will take to pay off the loan.

Variable-Rate Student Loans

A variable-rate student loan has an interest rate that can change over time. The biggest factor in determining your interest rate is the prime rate, which is the lending rate that banks charge their best customers. When the prime rate goes up, so does your student loan’s interest rate. Most variable-rate student loans use the prime rate plus a margin. The margin is a set percentage above the prime rate that depends on factors like your credit score and repayment options. For example, if the current prime rate is 5% and your margin is 2.5%, you’ll pay 7.5% interest on your loan until the rates change again.

Student Loan Interest Rates

The average student loan interest rate is 7.08% for the 2018-2019 academic year. This is the weighted average of all the interest rates for each type of loan that make up your total federal student loan. The weighted average is calculated by taking the sum of all the interest rates and dividing it by the total amount of debt.

Federal Student Loan Interest Rates

Federal student loan interest rates are set by Congress and typically adjust every year on July 1. Your exact interest rate depends on the type of loan you have—undergraduate, graduate, or parent—as well as other factors, such as whether you have a low income.

The weighted average interest rate for Direct Subsidized Loans and Direct Unsubsidized Loans for undergraduates is 4.53% for the 2019-2020 academic year. The weighted average interest rate for Graduate PLUS loans is 7.08%.

If you have a Perkins Loan, you’ll be charged 5% interest.

Private Student Loan Interest Rates

The interest rate on your private student loan will depend on a number of factors, including your credit score, the length of your loan, and the lender you choose.

Generally, private student loan interest rates range from 4% to 12%. If you have a strong credit history, you may be able to secure a low interest rate. If you have a cosigner with good credit, that may also help lower your interest rate.

You can compare private student loan interest rates from multiple lenders to find the best deal. Make sure to compare not only the interest rate but also the fees and terms of each loan.