Best Student Loan Interest Rates Of 2025

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Compare the Best Student Loan Interest Rates of 2025

5.0

Via Credible.com’s Website

Fixed Apr
Starting at 3.04%

Minimum Credit Score
Not disclosed

4.9

Via College Ave’s Website

Fixed Apr
Starting at 2.99%¹

Minimum Credit Score
mid-600s

4.9

Via Earnest’s Website

Fixed Apr
Starting at 3.19%

Minimum Credit Score
650

4.9

Via Credible.com’s Website

Fixed Apr
Starting at

Minimum Credit Score
680

4.6

Via Ascent’s Website

Fixed Apr
Starting at 3.09%

Minimum Credit Score
Not disclosed

4.6

Via Credible.com’s Website

Fixed Apr
Starting at3.69%

Minimum Credit Score
680

4.6

Via SoFi’s Website

Fixed Apr
Starting at 3.23%

Minimum Credit Score
650

4.5

Via Credible.com’s Website

Fixed Apr
Starting at 3.24%

Minimum Credit Score
640

4.4

Via Sallie Mae’s Website

Fixed Apr
Starting at 2.99%

Minimum Credit Score
Does not disclose

4.3

Via Credible.com’s Website

Fixed Apr
Starting at 3.47%

Minimum Credit Score
mid to high 600

COMPANY FORBES ADVISOR RATING FIXED APR MINIMUM CREDIT SCORE LEARN MORE
5.0

Starting at 3.04%
Not disclosed
Via Credible.com’s Website
4.9

Starting at 2.99%¹
mid-600s
Via College Ave’s Website
4.9

Starting at 3.19%
650
Via Earnest’s Website
4.9

Starting at
680
Via Credible.com’s Website
4.6

Starting at 3.09%
Not disclosed
Via Ascent’s Website
4.6

Starting at3.69%
680
Via Credible.com’s Website
4.6

Starting at 3.23%
650
Via SoFi’s Website
4.5

Starting at 3.24%
640
Via Credible.com’s Website
4.4

Starting at 2.99%
Does not disclose
Via Sallie Mae’s Website
4.3

Starting at 3.47%
mid to high 600
Via Credible.com’s Website

Best Student Loan Rates

Abe

5.0
Our ratings take into account loan cost, loan details, eligibility and accessibility, customer experience and application process. All ratings are determined solely by our editorial team.

Fixed APR

3.04%

Minimum Credit Score

Not disclosed




Compare Rates

Arrow

Via Credible.com’s Website

3.04%

Not disclosed

Editor’s Take

Launched in 2024, Abe burst onto the student loan scene offering low rates, rate discounts and benefits, such as multiple payment relief options for borrowers struggling financially.

We love that Abe provides interest rate discounts of 0.25% for using autopay and an additional discount of up to 0.25% for consistently making on-time payments. Plus, you can request a 2% Grad Reward after graduation, which can reduce your principal balance.

Pros & Cons
  • Payment grace periods of up to 12 months
  • 2% principal reward upon graduation and ongoing rate discounts
  • Co-signer release available after 12 months
  • No fees, including no late fees
  • Unclear minimum credit requirements
  • Fewer customer reviews due to lender age
Details

Loan terms
Five, seven, 10, 15 and 20-year terms.

Loan amounts
Up to the total cost of school, with a maximum of $99,999 per academic year. Aggregate limit of $225,000 for undergraduate and graduate loans (unless borrowing with a co-signer); $350,000 aggregate limit for specialty loans, such as dental or medical loans

Forbearance options
Up to 12 months may be available for medical and financial hardship.

Co-signer release policy
Co-signer release may be available after making 12 months of principal and interest payments.

College Ave

4.9
Our ratings take into account loan cost, loan details, eligibility and accessibility, customer experience and application process. All ratings are determined solely by our editorial team.

Fixed APR

Starting at 2.99%¹

Minimum Credit Score

mid-600s




Go to Lender Site

Arrow

Via College Ave’s Website

Starting at 2.99%¹

mid-600s

Editor’s Take

We love that College Ave offers a variety of student loans, including specialized loan options for borrowers pursuing advanced degrees in business and healthcare professions.

Borrowers can defer loans during dental and medical residency, and depending on their degree, payments may not be due until up to 36 months after finishing school.

Pros & Cons
  • Deferment available during dental and medical residency programs
  • Payment grace periods of up to 36 months
  • Forbearance available for up to 12 months
  • Co-signer release only available after half the loan term has elapsed
  • Late payments incur late fees
Details

Loan terms
5, 8, 10 and 15 years.

Loan amounts
$1,000 up to 100% of the school-certified cost of attendance.

Forbearance options
Up to 12 months of forbearance available in three- to six-month increments.

Co-signer release policy
Borrowers may qualify for co-signer release at the halfway point of the loan term.

*Disclosures

College Ave Student Loans products are made available through Firstrust Bank, member FDIC, First Citizens Community Bank, member FDIC, or M.Y. Safra Bank, FSB, member FDIC. All loans are subject to individual approval and adherence to underwriting guidelines. Program restrictions, other terms, and conditions apply.

  • (1)All rates include the auto-pay discount. The 0.25% auto-pay interest rate reduction applies as long as a valid bank account is designated for required monthly payments. If a payment is returned, you will lose this benefit. Variable rates may increase after consummation.
  • (2)As certified by your school and less any other financial aid you might receive. Minimum $1,000.
  • (3)This informational repayment example uses typical loan terms for a freshman borrower who selects the Flat Repayment Option with an 8-year repayment term, has a $10,000 loan that is disbursed in one disbursement and a 7.78% fixed Annual Percentage Rate (“APR”): 54 monthly payments of $25 while in school, followed by 96 monthly payments of $176.21 while in the repayment period, for a total amount of payments of $18,266.38. Loans will never have a full principal and interest monthly payment of less than $50. Your actual rates and repayment terms may vary.

Information advertised valid as of 07/28/2025. Variable interest rates may increase after consummation. Approved interest rate will depend on creditworthiness of the applicant(s), lowest advertised rates only available to the most creditworthy applicants and require selection of the Flat Repayment Option with the shortest available loan term.

Earnest

4.9
Our ratings take into account loan cost, loan details, eligibility and accessibility, customer experience and application process. All ratings are determined solely by our editorial team.

Fixed APR

Starting at 3.19%

Minimum Credit Score

650




Go to Lender Site

Arrow

Via Earnest’s Website

Starting at 3.19%

650

Editor’s Take

Earnest provides its lowest interest rates to borrowers who apply with a co-signer, so it’s a good option to consider if you have a creditworthy co-signer to add to your application. A unique feature of Earnest loans is the Rate Match Guarantee, which promises to match competitor rates if you find a better rate elsewhere.

Pros & Cons
  • Provides rate match guarantee
  • Forbearance available for up to 12 months
  • No fees, including no late fees
  • Co-signer release not available
  • At least fair credit necessary to qualify
Details

Loan terms
Five, seven, 10, 12 or 15 years

Loan amounts
$1,000 up to the total cost of attendance with a $400,000 lifetime limit

Forbearance options
Up to 12 months of forbearance may be available.

Co-signer release policy
Co-signer release isn’t available. You have to refinance the loan to remove a co-signer.

Disclosures

¹You can take advantage of the Auto Pay interest rate reduction by setting up and maintaining active and automatic ACH withdrawal of your loan payment from a checking or savings account. The interest rate reduction for Auto Pay will be available only while your loan is enrolled in Auto Pay. Interest rate incentives for utilizing Auto Pay may not be combined with certain private student loan repayment programs that also offer an interest rate reduction. For multi-party loans, only one party may enroll in Auto Pay. It is important to note that the 0.25% Auto Pay discount is not available while loan payments are deferred.

²Earnest clients may skip one payment every 12 months. Your first request to skip a payment can be made once you’ve made at least 6 months of consecutive on-time payments, and your loan is in good standing. The interest accrued during the skipped month will result in an increase in your remaining minimum payment. The final payoff date on your loan will be extended by the length of the skipped payment periods. Please be aware that a skipped payment does count toward the forbearance limits. Please note that skipping a payment is not guaranteed and is at Earnest’s discretion. Your monthly payment and total loan cost may increase as a result of postponing your payment and extending your term.

³Nine-month grace period is not available for borrowers who choose our Principal and Interest Repayment plan while in school.

⁴Earnest’s Loan Cost Examples: These examples provide estimates based on principal and Interest payments beginning immediately upon loan disbursement. Variable APR: A $10,000 loan with a 15-year term (180 monthly payments of $118.28) and a 11.69% APR would result in a total estimated payment amount of $21,290.40. For a variable loan, after your starting rate is set, your rate will then vary with the market. Fixed APR: A $10,000 loan with a 15-year term (180 monthly payments of $126.82) and a 13.03% APR would result in a total estimated payment amount of $22,827.79.

These examples provide estimates based on interest only payments while in school. Variable APR: A $10,000 loan with a 15-year term (180 monthly payments of $145.41) and a 11.69% APR would result in a total estimated payment amount of $26,173.03. For a variable loan, after your starting rate is set, your rate will then vary with the market. Fixed APR: A $10,000 loan with a 15-year term (180 monthly payments of $156.59) and a 13.03% APR would result in a total estimated payment amount of $28,186.67. Your actual repayment terms may vary. Other repayment options are available.

These examples provide estimates based on fixed $25 payments while in school. Variable APR: A $10,000 loan with a 15-year term (180 monthly payments of $169.92) and a 11.69% APR would result in a total estimated payment amount of $30,584.74. For a variable loan, after your starting rate is set, your rate will then vary with the market. Fixed APR: A $10,000 loan with a 15-year term (180 monthly payments of $188.42) and a 13.03% APR would result in a total estimated payment amount of $33,915.55. Your actual repayment terms may vary. Other repayment options are available.

These examples provide estimates based on deferred payments. Variable APR: A $10,000 loan with a 15-year term (180 monthly payments of $174.79) and a 11.69% APR would result in a total estimated payment amount of $31,462.16. For a variable loan, after your starting rate is set, your rate will then vary with the market. Fixed APR: A $10,000 loan with a 15-year term (180 monthly payments of $193.75) and a 13.03% APR would result in a total estimated payment amount of $34,874.28. Your actual repayment terms may vary. Other repayment options are available.

⁵Loan Eligibility criteria: Eligible students must: 1) For college Freshmen, Sophomores and Juniors, attend, or be enrolled to attend, a Title IV school full-time. For college Seniors and Graduate students, attend, or be enrolled to attend, a Title IV school at least half-time; and 2) be pursuing a Bachelor’s or Graduate degree. Earnest private student loans are subject to credit qualification, completion of a loan application, verification of application information, self-certification of loan amount, and school certification.

Responsible borrowing tip: Explore all scholarship, grant and federal options before applying for a private loan.

Earnest Private Student Loans are made by One American Bank, Member FDIC, or FinWise Bank, Member FDIC. One American Bank, 515 S. Minnesota Ave, Sioux Falls, SD 57104. Finwise Bank, 756 East Winchester, Suite 100, Murray, UT 84107.

Earnest loans are serviced by Earnest Operations LLC, 300 Frank H. Ogawa Plaza, Suite 340, Oakland 94612. NMLS #1204917, with support from Higher Education Loan Authority of the State of Missouri (MOHELA) (NMLS# 1442770) One American Bank, FinWise Bank, and Earnest LLC and its subsidiaries, including Earnest Operations LLC, are not sponsored by agencies of the United States of America.

© 2025 Earnest LLC. All rights reserved.

RISLA

4.9
Our ratings take into account loan cost, loan details, eligibility and accessibility, customer experience and application process. All ratings are determined solely by our editorial team.

Fixed APR

Starting at 2.99%

Minimum Credit Score

680




Compare Rates

Arrow

Via Credible.com’s Website

Starting at 2.99%

680

Editor’s Take

Rhode Island Student Loan Authority (RISLA) offers loans to student and parent borrowers with multiple payment relief options. Notably, RISLA offers income-based repayment plans to borrowers facing financial hardship, a rarity among private student loan lenders. Additionally, RISLA may forgive loans after permanent disability.

Pros & Cons
  • Provides income-based repayment plans
  • Forbearance available for up to 24 months
  • Co-signer release available after 24 months
  • Only two loan terms: 10 and 15 years
  • Limits on loan amounts
  • Late payments incur late fees
Details

Loan terms
10 and 15 years

Loan amounts
Up to $50,000 or the full cost of attendance for each academic year, whichever is less

Forbearance options
Up to 24 months in forbearance may be available when facing economic hardship.

Co-signer release policy
Co-signer release may be available after 24 consecutive on-time payments.

Ascent

4.6
Our ratings take into account loan cost, loan details, eligibility and accessibility, customer experience and application process. All ratings are determined solely by our editorial team.

Fixed APR

Starting at 3.09%

Minimum Credit Score

Not disclosed




Go to Lender Site

Arrow

Via Ascent’s Website

Starting at 3.09%

Not disclosed

Editor’s Take

Ascent provides a wide range of loan options, including career training loans and outcomes-based loans for borrowers who don’t have a co-signer.

Ascent considers alternative factors, such as your GPA and graduation date, to qualify you for outcomes-based loans, presenting a golden opportunity for independent students who have strong academic performance but limited credit and income.

Pros & Cons
  • Co-signer release available after 12 consecutive months of on-time payments
  • Borrowers may receive a 1% cash back reward upon graduation
  • Interest rate discounts are available for using autopay
  • Loans without a co-signer may have significantly higher rates
  • Unclear minimum credit requirements
  • 5% origination fee for career training loans
Details

Loan terms
Five, seven, 10, 12, 15 or 20 years; see repayment examples for more details.

Loan amounts
$2,001** up to total cost of attendance, to a maximum of $200,000 per academic year ($200,000 aggregate) for undergraduate loans and $400,000 for graduate loans

Forbearance options
Up to 24 months of forbearance for financial hardship, available in increments of three months.

Co-signer release policy
Co-signer release may be available after 12 consecutive and on-time loan payments.

*Disclosure

*Ascent’s undergraduate and graduate student loans are funded by Bank of Lake Mills or DR Bank, each Member FDIC. Loan products may not be available in certain jurisdictions. Certain restrictions, limitations, terms and conditions may apply for Ascent’s Terms and Conditions please visit: AscentFunding.com/Ts&Cs. Annual Percentage Rates (APRs) displayed above are effective as of 7/1/2025 and reflect an Automatic Payment Discount of 0.25% on credit-based college student loans submitted prior to 6/1/2025, a 0.5% discount for on credit-based college student loans submitted on or after 6/1/2025 and a 1.00% discount on outcomes-based loans when you enroll in automatic payments. Loans subject to individual approval, restrictions and conditions apply. Loan features and information advertised are intended for college student loans and are subject to change at any time. For more information, see repayment examples or review the Ascent Student Loans Terms and Conditions. The final amount approved depends on the borrower’s credit history, verifiable cost of attendance as certified by an eligible school and is subject to credit approval and verification of application information. Lowest interest rates require full principal and interest (Immediate) payments, the shortest loan term, a cosigner, and are only available for our most creditworthy applicants and cosigners with the highest average credit scores. Actual APR offered may be higher or lower than the examples above, based on the amount of time you spend in school and any grace period you have before repayment begins. Variable rates may increase after consummation.1% Cash Back Graduation Reward subject to terms and conditions. For details on Ascent borrower benefits, visit AscentFunding.com/BorrowerBenefits. Ascent applicants and borrowers that agree to the AscentUP Terms of Service and Privacy Policy, as well as students associated with an Ascent parent loan application, have access to the AscentUP platform.

**The minimum amount is $2,001, except for the state of Massachusetts. The minimum loan amount for borrowers with a Massachusetts permanent address is $6,001.

ELFI

4.6
Our ratings take into account loan cost, loan details, eligibility and accessibility, customer experience and application process. All ratings are determined solely by our editorial team.

Fixed APR

Starting at 2.99%

Minimum Credit Score

680




Compare Rates

Arrow

Via Credible.com’s Website

Starting at 2.99%

680

Editor’s Take

ELFI is a nationwide program offered through SouthEast Bank. ELFI is highly transparent with eligibility criteria, which makes it easier to measure your likelihood of qualifying. Borrowers (or co-signers) need a minimum credit score of 680 and a minimum income of $35,000 per year to be eligible for a loan.

Pros & Cons
  • Transparent eligibility requirements
  • Forbearance available for up to 12 months
  • One-on-one support from student loan advisors
  • No co-signer release without refinancing
  • Strong credit is necessary to qualify
Details

Loan terms
Five to 15 years.

Loan amounts
Up to the maximum loan size approved by the school for qualified education expenses.

Forbearance options
Up to 12 months of forbearance for financial hardship or medical difficulty.

Co-signer release policy
Co-signer release is not available at this time.

SoFi®

4.6
Our ratings take into account loan cost, loan details, eligibility and accessibility, customer experience and application process. All ratings are determined solely by our editorial team.

Fixed APR

Starting at 3.23%

Minimum Credit Score

650




Go to Lender Site

Arrow

Via SoFi’s Website

Starting at 3.23%

650

Editor’s Take

SoFi® stands out for offering opportunities to earn rewards for completing SoFi® member tasks. SoFi® loans also feature no fees, including no late fees. Additionally, SoFi® borrowers can receive a cash bonus of up to $250 deposited into a SoFi checking or savings account for each school term they earn a GPA of 3.0 or higher.

Pros & Cons
  • Cash-back rewards, bonuses and rate discounts
  • Co-signer release available after 12 months
  • No fees, including no late fees
  • Unclear forbearance options
Details

Loan terms
Five, seven, 10 and 15 years

Loan amounts
$1,000 up to the total cost of attendance

Eligibility
SoFi doesn’t disclose credit score or income requirements. However, SoFi borrowers typically have scores as low as 650.

Forbearance options
Borrowers can apply for hardship forbearance on SoFi’s website; however, the website doesn’t specify the number of months or years forbearance may be available.

Co-signer release policy
Co-signer release is available after 24 months of principal and interest payments, subject to credit approval.

*Disclosures

* Interest Rates: Eligibility and Important Details. Fixed rates range from 3.23% APR to 15.99% APR with 0.25% autopay discount. Variable rates range from 4.39% APR to 15.99% APR with a 0.25% autopay discount. Unless required to be lower to comply with applicable law, Variable Interest rates are capped at 17.95%. SoFi rate ranges are current as of 7/10/2025 and are subject to change at any time. Your actual rate will be within the range of rates listed above and will depend on the term and type of repayment option you select, evaluation of your creditworthiness, income, presence of a co-signer (if applicable) and a variety of other factors. Lowest rates reserved for the most creditworthy borrowers. Check out our eligibility criteria at https://www.sofi.com/eligibility-criteria/. For the SoFi variable-rate product, the variable interest rate for a given month is derived by adding a margin to the 30-day average SOFR index, published two business days preceding such calendar month, rounded up to the nearest one hundredth of one percent (0.01% or 0.0001). APRs for variable-rate loans may increase after origination if the SOFR index increases. The SoFi 0.25% autopay interest rate reduction requires you to agree to make monthly principal and interest payments by an automatic monthly deduction from a savings or checking account. This benefit will discontinue and be lost for periods in which you do not pay by automatic deduction from a savings or checking account. The benefit lowers your interest rate but does not change the amount of your monthly payment. This benefit is suspended during periods of deferment and forbearance. Autopay is not required to receive a loan from SoFi. SoFi Private Student loans are originated by SoFi Bank, N.A. Member FDIC. NMLS #696891 (www.nmlsconsumeraccess.org).

Terms and conditions apply. Offer good for new and repeat borrowers that apply for and are approved for a SoFi Private Student Loan. You must complete a loan application with SoFi between 5/21/25 12:01AM PT to 09/3/25 11:59PM PT. Cannot be combined with any other rate discounts, with the exception of the 0.25% autopay rate discount, 0.125% SoFi Plus Parent discount, and MBA/Law 0.25% discount running until 6/9/25. SoFi reserves the right to change or terminate the Discount at any time. See SoFi.com/collegemoney for details.

Citizens Bank

4.5
Our ratings take into account loan cost, loan details, eligibility and accessibility, customer experience and application process. All ratings are determined solely by our editorial team.

Fixed APR

Starting at 3.24%

Minimum Credit Score

640




Compare Rates

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Via Credible.com’s Website

Starting at 3.24%

640

Editor’s Take

Citizens Bank is a brick-and-mortar financial institution that offers student loans nationwide and provides loyalty incentives for borrowers with deposit accounts.

Citizens Bank offers a 0.25% percentage point rate discount for using autopay and an additional 0.25% rate discount if the borrower or co-signer has a Citizens Bank checking account or opens one before signing loan documents.

Pros & Cons
  • Autopay and customer loyalty discounts
  • Forbearance available for up to 12 months
  • 36 payments needed for co-signer release
  • Late payments incur late fees
Details

Loan terms
Five, 10 and 15 years

Loan amounts
$1,000 to $400,000 (depending on degree)

Eligibility
Parent applicants and students must be U.S. citizens, permanent residents or eligible non-citizens with creditworthy co-signers. Students must attend school at least half-time.

Forbearance options
Forbearance of up to 12 months throughout the life of the loan may be available in two-month increments.

Co-signer release policy
Co-signers can be released from the loan after 36 consecutive on-time payments.

Sallie Mae

4.4
Our ratings take into account loan cost, loan details, eligibility and accessibility, customer experience and application process. All ratings are determined solely by our editorial team.

Fixed APR

2.99% to 17.49%

Minimum Credit Score

Does not disclose




Go to Lender Site

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Via Sallie Mae’s Website

2.99% to 17.49%

Does not disclose

Editor’s Take

Sallie Mae offers flexible loans that can be used for college, professional training, trade schools and certificate programs. Additionally, students attending school for less than half-time are eligible, whereas many other lenders require at least half-time enrollment to get a loan. As an extra perk, borrowers and co-signers get access to quarterly FICO credit scores for free.

Pros & Cons
  • Students enrolled less than half-time are eligible
  • Co-signer release available after 12 months
  • Free FICO Scores
  • Conditions for forbearance not disclosed
  • Late payments incur late fees
Details

Loan terms
10 to 20 years

Loan amounts
Up to 100% of the cost of school attendance.

Forbearance options
Sallie Mae offers forbearance but doesn’t specify the amount of time you can pause payments for when facing hardship. You’ll have to reach out to discuss payment relief.

Co-signer release policy
Co-signers may be eligible for co-signer release after borrowers make 12 on-time payments.

Nelnet

4.3
Our ratings take into account loan cost, loan details, eligibility and accessibility, customer experience and application process. All ratings are determined solely by our editorial team.

Fixed APR

Starting at 3.47%

Minimum Credit Score

mid to high 600




Compare Rates

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Via Credible.com’s Website

Starting at 3.47%

mid to high 600

Editor’s Take

Nelnet Bank is a provider of private student loans that operates separately from Nelnet, the federal loan servicer. Nelnet Bank has a loan limit up to $500,000 for graduate health professional degrees, which is higher than the loan caps set by other lenders.

Additionally, Nelnet Bank clearly defines minimum eligibility requirements on its website, which can help borrowers identify whether the loan is a good fit.

Pros & Cons
  • High loan limits
  • Co-signer release available after 24 months
  • Unclear forbearance options
  • Late payments incur late fees
Details

Loan terms
Five to 25 years, depending on your loan amount and repayment plan

Loan amounts
$1,000 up to $125,000 for undergraduate loans; $175,000 for graduate, MBA or law degree loans; and $500,000 for graduate health degree loans

Eligibility
Borrowers and co-signers must be U.S. citizens or permanent residents with a valid U.S. Social Security number. The minimum credit score is in the mid- to high-600s.

Forbearance options
Assistance programs may be available to borrowers struggling to make payments.

Co-signer release policy
Co-signer release is available after 24 months of consecutive on-time payments.

Current Student Loan Rates

Federal student loan interest rates are fixed and set annually by Congress based on interest rates on the 10-year Treasury note.

Federal loans taken out after July 1, 2025, and before July 1, 2026, have the following rates.

Federal Loan Type Borrower Type Fixed Interest Rate
Direct Subsidized and Unsubsidized Loans
Undergraduate
6.39%
Unsubsidized Loans
Graduate and Professional
7.94%
Direct PLUS Loans
Parents and Graduate or Professional Students
8.94%

Private lenders set their own rates and assign low student loan rates to borrowers based on creditworthiness. Below are average current and historic private student loan interest rates.

Very rarely are no-interest student loans available. No-interest loans that exist are typically offered through schools, government agencies or nonprofit programs, and you must meet specific requirements to qualify.


Pro Tip

Even if the best available rates at private lenders are considerably lower than federal loan rates, it’s often a good idea to consider federal loans first. That’s because the best private loan rates go to applicants with very strong credit.

Young students and borrowers with limited credit history may not qualify for the most affordable loans. Plus, federal loans come with various perks—like loan forgiveness programs and income-driven repayment plans—that can be useful during repayment.

How Student Loan Interest Rates Work

While Direct Loans are always fixed, private student loan rates may be fixed or variable.

One type of loan—variable rate versus fixed rate—isn’t better than the other, but there are situations where one could make more sense for you.

Variable-Interest Loans

Variable rates can adjust periodically following an index, such as the Secured Overnight Financing Rate (SOFR). This means your rate and payment can change during the life of your loan. However, lenders may impose conditions on the rate adjustments; for example, there may be a limit on how high your rate can go.

When it makes sense: A variable-interest loan may be worth exploring if you can secure a low rate and you can pay off the loan or refinance it before the rate adjusts higher.

Fixed-Interest Loans

Fixed-rate loans have the same interest rate and payment throughout the entire term. Once you sign your promissory note, the rate won’t change unless you choose to refinance the loan.

When it makes sense: A fixed-rate loan is a good move when you value predictability in your monthly payments. A fixed rate is easier to budget for as you begin your career and work toward financial goals, such as planning for a home purchase or starting a family.

How Are Private Student Loan Rates Determined?

On a broader level, private student loan rates are influenced by the overall interest rate market.

On an individual level, rates are assigned depending on a borrower’s likelihood of default. Having strong credit indicates you’re a lower credit risk, which can lead to better interest rates.

These are factors lenders consider to determine rates:

  • Credit score: A score of 700 or higher can land you better interest rates.
  • Credit history: Having no late payments on your record can improve your terms.
  • Income and employment: Having an offer letter or consistent employment with a stable income can indicate to lenders that you’re a lower credit risk.
  • Education: Your level of education and earning potential in your career field could influence the rate the lender sets for your loan.

How To Get a Low Interest Rate

When you’re in the market for a student loan, the following steps could help you qualify for a competitive interest rate.

  1. Shop around. Look for loans across multiple lenders, including credit unions, traditional banks and online lenders. Review the eligibility requirements and loan rates to determine where you might find the best loan.
  2. Fill out the free application for federal student aid (FAFSA) each year. If you have bad credit or limited credit, federal loans may offer the lowest rates you can obtain. To qualify for federal loans and other aid, you need to fill out the FAFSA each year.
  3. Prequalify with private lenders. Many lenders allow you to prequalify for private student loans without a hard credit check, enabling you to receive personalized offers to compare before making a loan decision.
  4. Get a co-signer. Getting a co-signer with strong credit and high income to back your loan is a strategy that can improve your loan offers.
  5. Sign up for autopay. When approved for a loan, both private loans and federal loans may offer discounts when you sign up for autopay to make loan payments.

Ways To Reduce Interest Charges on Student Loan Debt

After taking out a loan, here are ways to reduce the amount you pay in interest:

  • Pay interest while in school. For private loans and unsubsidized federal loans, interest can start accruing as soon as funds are disbursed. Paying the interest charges while you’re in school can keep the interest from growing.
  • Make advance payments. Making extra principal-only payments on your student loans can help reduce your loan balance faster, resulting in lower interest charges.
  • Refinance your debt. If your credit improves after borrowing, refinancing your loans can help you secure a lower interest rate and save money on interest.
  • Pursue loan forgiveness if you qualify. Teachers and public service employees may be eligible for loan forgiveness programs that wipe away balances (including unpaid interest) after a certain number of years working in an eligible career field.

Alternatives to Student Loans

Student loans are just one way to finance your education. Below are other ways to cover tuition and other school expenses.

  • 529 plans: 529 plans offer tax-advantaged education savings accounts you can set up for yourself (or another student) to save and pay for tuition and other school expenses. 529 plans can also be passed to relatives, so if you know someone with money remaining in a 529 plan, you could ask them to share the wealth.
  • Scholarships: Completing the FAFSA can put you in the running for government and institutional aid, such as scholarships. You can also search for and apply to scholarships offered by various organizations and companies.
  • Grants: The government may provide grants for borrowers who demonstrate a financial need. Education grants may also be available through nonprofits, private companies or state programs.
  • Work study: One of the types of aid you can receive in your student aid package is work study. Work study provides you with an on-campus or off-campus job that can help pay for school.

Compare Student Loan Rates In Minutes

Compare rates from participating lenders via Credible.com

Frequently Asked Questions (FAQs)

What is the best student loan interest rate?

The best student loan interest rate is the lowest available to you. Student loan interest rates from private lenders are currently starting at 2.99% APR.

What is a reasonable interest rate for a student loan?

The average interest rate for a student loan is 6.95% APR for a 10-year fixed-rate loan and 8.58% APR for a five-year fixed-rate loan, according to Credible data from July 2025. However, interest rates can vary depending on your credit.

How much is a $30,000 student loan per month?

The payment for a $30,000 student loan is set based on your interest rate and loan term. For example, for a $30,000 loan with a 10-year term and an APR of 7.93%, the monthly payment would be $362.87. The loan would incur a total interest cost of $13,544.89.

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