How to get your Student Loan Interest Rates Lowered (2024)

FAQs

How to get your Student Loan Interest Rates Lowered? ›

Refinancing could help you lower your interest rate, especially if you have good credit and stable income. Many lenders will reduce your interest rate by 0.25 percentage points if you sign up for autopay. The faster you pay off your student loans, the less interest you'll pay over time.

Refinancing could help you lower your interest rate, especially if you have good credit and stable income. Many lenders will reduce your interest rate by 0.25 percentage points if you sign up for autopay. The faster you pay off your student loans, the less interest you'll pay over time.

Pay More than Your Minimum Payment

Paying a little extra each month can reduce the interest you pay and reduce your total cost of your loan over time. Continue to make monthly payments even if you've satisfied future payments, and you'll pay off your loan faster.

Negotiate With Your Loan Servicer

This is much easier than student loan refinancing. If you have federal student loans, you don't have the option to negotiate down your interest rate. But you do have several other advantages and options.

You can't change the type of interest rate (fixed or variable) that your private student loan has once it's certified (approved) by your school. But there are some things you can do to lower your total loan cost. Take advantage of discounts your lender offers, like Sallie Mae's discount for enrolling in auto debit.

If you end up with loans with a higher rate, you may be eligible for student loan refinancing later. Refinancing your debt once you're employed and have established good credit could allow you to qualify for a new loan with a lower rate, so it can help you save money.

For existing borrowers, the interest rates on federal student loans are fixed at the time of disbursem*nt, as in they do not change throughout the life of the loan.

Cancelling student loan debt could also have a powerful stimulus effect on the economy, which will be crucial as we look to build a sustainable economic recovery. Research has shown that cancellation would boost GDP by billions of dollars and add up to 1.5 million new jobs, reducing the unemployment rate.

If you need a lower payment, consider applying for an income-driven repayment (IDR) plan, like the SAVE Plan. Under the SAVE Plan, making even periodic or partial payments may lower the amount of interest you accrue each month.

What is the highest federal student loan interest rate? ›

Current student loan interest rates

Federal student loans currently have interest rates ranging from 5.50 percent to 8.05 percent.

Borrowers with variable-rate student loans from private lenders may see their interest rate change when the federal funds rate changes. College students who take out federal student loans after the Fed increases interest rates will experience higher borrowing costs.

While in school, you can choose to make monthly interest payments or fixed $25^{footnote 8} payments each month—or you can choose to defer payments until after school. The repayment option you choose applies during school and for six months after you leave school (your grace period).

If you signed up for a Sallie Mae loan when you entered college, you may have a high interest rate because you were a college student with no credit history and no full-time income. If you now have a stable job and a good credit score, you may be eligible for a lower interest rate.

If you are financially able to do so, it may make sense for you to pay off your student loans early to save money on interest. Lenders typically call this “prepayment in full.” Generally, there are no penalties involved in paying off your student loans early.

Student loan interest rates will vary with current market rates, the type of loan you're using, and the quality of your (and your co-signer's) credit. While federal loans all use the same interest rate, which only changes once each academic year, other lenders can have a range of rates and change the rates frequently.

You can usually claim the student loan tax deduction if you meet all these requirements: Your filing status is any status except married filing separately. No one else is claiming you as a dependent. You're legally obligated to pay interest on a qualified student loan.