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If you need to take out student loans to pay for college, the interest rate you receive will play a big role in your total repayment cost. A high rate can cause interest to build rapidly, causing you to repay far more than you initially borrowed to pay for school.
Student loan interest rates can vary by loan type and lender, and the rate you get is dependent on your credit and the desired loan term. To find the best student loan rates, it pays to do some research and compare offers from multiple lenders.
Featured Partner Offers
Variable APR
5.59% to 16.85%
Fixed APR
4.17% to 16.69%
Variable APR
6.12% to 16.45%
Fixed APR
4.50% to 15.49%
Best Student Loan Interest Rates 2024
Federal Direct Subsidized Loans
Editor’s Take
Among undergraduate and graduate student loan options, federal direct subsidized loans are the cheapest and most flexible. Only undergraduate borrowers with financial need—as determined by the information in the Free Application for Federal Student Aid, or FAFSA—can get subsidized loans. The government will pay the interest when students are in school, during their grace period and when they put their loans into deferment.
The interest rate on subsidized loans is one of the lowest you’ll find, and no co-signer is required. All eligible undergraduate borrowers qualify and they receive the same rate regardless of credit history. Most importantly, borrowers of federal subsidized loans have access to income-driven repayment options that can lower the amount due and loan forgiveness for those who work in public service fields.
While there is an origination fee of 1.057%, it’s lower than what many private lenders offering loans without a co-signer charge.
Pros & Cons
Low fixed interest rate
Multiple repayment and forgiveness options available
Interest subsidy during certain periods
Charges an origination fee
Low annual loan limits
Details
Loan terms: 5, 7, 10, 15 and 20 years
Loan amounts available: $5,000 minimum; no maximum, except for associate’s degree graduates, who can refinance up to $50,000.
Eligibility: Must be enrolled at least half-time in a school that participates in the federal direct loan program. Must be an undergraduate and be determined to have financial need.
Forbearance options: Forbearance available for up to three years in certain circumstances. Enrolling in an income-driven repayment program can lower monthly payments and result in loan forgiveness after 20 to 25 years.
Federal Direct Unsubsidized Loan
Editor’s Take
Federal direct unsubsidized loans offer low fixed interest rates, and this type of loan isn’t credit-based and doesn’t require a co-signer. All eligible undergraduate borrowers qualify, and they receive the same rate regardless of credit history.
While there’s a chance the most creditworthy borrowers could get a lower interest rate with a private student loan, they’ll miss out on a range of consumer protections that might be useful in the future. Borrowers of federal direct unsubsidized loans have access to income-driven repayment options that can lower the amount due and loan forgiveness for those who work in public service fields.
Direct unsubsidized loans come with an origination fee of 1.057%, while most private loans do not. But in many cases, the low interest rate and loan benefits make the fee worth it.
Pros & Cons
Low fixed interest rate
Multiple repayment and forgiveness options available
No co-signer required in order to get lowest rate
Charges an origination fee
Details
Loan terms: Terms of 10 to 25 years are available, depending on the repayment plan.
Loan amounts: Loan amounts up to $12,500 per year and $57,500 in aggregate in aggregate are available.
Eligibility: You must be enrolled at least half-time in a school that participates in the federal direct loan program.
Forbearance options: Forbearance available for up to three years in certain circumstances. Enrolling in an income-driven repayment program can lower monthly payments and result in loan forgiveness after 20 to 25 years.
Co-signer release policy: N/A
Custom Choice
Editor’s Take
Custom Choice provides private student loans to undergraduate and graduate students. This lender stands out due to its competitive interest rates and no-fee structure; borrowers will never pay late fees, origination fees or prepayment penalties.
Custom Choice also offers a few unique benefits, including a Graduate Reward that reduces your loan’s principal balance by 2% when you get your degree.
Pros & Cons
No fees, including late or origination fees
Receive a 2% principal reduction after submitting proof of graduation
0.25% interest rate discount when you enroll in autopay
Not transparent about credit and income requirements
Co-signer release after 36 months, about 12 months later than many other lenders’ policies
Details
Loan terms: 7, 10 or 15 years
Loan amounts available: $1,000 to $99,999 per year ($180,000 aggregate per borrower)
Eligibility: Does not publicly disclose credit score or income requirements, but you will need to submit proof of income and your monthly housing costs. Depending on your circumstances, students are likely to need a co-signer to qualify.
Forbearance options: Forbearance available for up to 12 months.
Education Loan Finance
Editor’s Take
Education Loan Finance (known as ELFI) offers student loans to borrowers enrolled at least half-time. Eligible students can borrow as little as $1,000 and choose from four repayment plans, including interest-only payments or a flat $25 monthly payment while you’re in school.
ELFI’s rates are competitive, though you’ll need excellent credit to lock in the lowest APRs. If your credit isn’t strong enough, you can add a well-qualified co-signer to your application.
Pros & Cons
Transparent eligibility requirements
No application, origination or prepayment fees
Comparatively low interest rates
All payments must be made electronically
You must attend an eligible school to borrow
Details
Loan terms: 5, 7, 10 and 15 years
Loan amounts available: $1,000 up to 100% of the school-certified cost of attendance.
Eligibility: Must be a U.S citizen or permanent resident enrolled in a bachelor’s, master’s or doctoral program at least half-time. The primary borrower must have a credit score of 680 or higher and an annual income of at least $35,000 per year. A credit history of at least three years is required.
Forbearance options: Up to 12 months of forbearance available
SoFi®
Variable APR
5.74% to 15.86%*
with autopay and rate sale discount
Fixed APR
4.19% to 14.83%*
with autopay and rate sale discount
5.74% to 15.86%*
with autopay and rate sale discount
4.19% to 14.83%*
with autopay and rate sale discount
Editor’s Take
SoFi is perhaps best known as a student loan refinance lender, but it also makes loans to undergraduates, graduate students, law and business students and parents. Its undergraduate student loan product offers mostly industry-standard features, plus a couple perks: no late fees and an interest rate discount of 0.125% if your co-signer already uses another SoFi product.
Pros & Cons
Access to SoFi member benefits
No late fees
Interest rate estimate available without undergoing a hard credit check
Details
Loan terms
Five, seven, 10 and 15 years.
Loan amounts
$1,000 up to the total cost of attendance
Eligibility
Does not disclose credit score or income requirements
Forbearance options
Qualified borrowers can take up to 12 months total forbearance.
Co-signer release policy
Available after 24 payments
Rhode Island Student Loan Authority
Editor’s Take
Rhode Island Student Loan Authority, known as RISLA, is a nonprofit based in Rhode Island that lends to students across the country. It offers two different loan types for undergraduate students, which each come with their own fixed interest rates. One loan requires immediate repayment, and one lets you defer payments until six months after you leave school. Everyone who qualifies for each of the loan types gets the same rate, which makes it easy to compare RISLA loans with others you’ve qualified for.
For borrowers who struggle to afford their loan after graduating, RISLA is one of the only private lenders to offer an income-based repayment plan, which limits payments to 15% of income for a 25-year period.
RISLA was a winner of Forbes Advisor’s best private student loans of 2020 awards. Learn more here.
Pros & Cons
Low interest rates
Income-based repayment plan available
Nurses pay 0% interest for 48 months following graduation
No options for international students
Details
Loan terms:
5, 10 and 15 years
Loan amounts available:
$1,500 to $45,000 per year ($150,000 aggregate per borrower).
Eligibility:
Applicants must show a minimum income of $40,000 per year and a minimum credit score of 680. Most undergraduate students will need a co-signer to qualify.
Forbearance options:
Forbearance available for up to 24 months.
Co-signer release policy:
Co-signer release is available after 24 months of payments. Periods during which borrowers use income-based repayment do not qualify.
Ascent
Editor’s Take
Ascent offers both co-signed and non-co-signed student loans, which gives borrowers without co-signers more college funding options. We scored the company based on its co-signed credit-based student loan for undergraduates.
Ascent stands out for its range of payment reduction and postponement options, rare among private student loan companies. Borrowers can choose a graduated repayment plan, which provides a lower monthly payment to start that increases over time. That can be useful for graduates just starting out, who will likely make more money as they move up in their careers.
Borrowers also can pause payments if they’re experiencing a temporary financial hardship for one to three months at a time, up to a maximum of 24 months total. However, taking this forbearance means you will repay the loan over a longer period. Interest continues to accrue during forbearance, which is true for the vast majority of private student loans.
Ascent also offers benefits for students including 1:1 free success coaching*, a graduation reward of 1% of the loan’s original principal balance and access to monthly no-essay scholarships.
Ascent was a winner of Forbes Advisor’s best private student loans of 2021 awards. Learn more here.
Pros & Cons
Both co-signed and independent loans available
International students can qualify with a co-signer who has U.S. citizenship or permanent residency
Interest rate estimate available without undergoing a hard credit check
Charges late fees
Maximum APR is above 10%
Details
Loan terms
5, 7, 10, 12 or 15 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)
Eligibility
Student borrowers with no credit history can qualify with a creditworthy co-signer. Co-signers must show an income of at least $24,000 for the current and previous year. Co-signers must have a minimum credit score, which can vary.***
Forbearance options
When experiencing financial hardship, borrowers can suspend payments for up to three months at a time, for a total of up to 24 months throughout the loan term. Only four rounds of forbearance (up to 12 months’ worth) may be taken consecutively.
Co-signer release policy
Co-signer release is available after 12 months of consecutive automatic debit payments if the primary borrower meets certain credit score requirements.***
*Other eligibility requirements apply. Learn more at AscentFunding.com/BorrowerBenefits.
**The minimum amount is $2,001 except for the state of Massachusetts. Minimum loan amount for borrowers with a Massachusetts permanent address is $6,001.
***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; and terms and conditions may apply. For Ascent Terms and Conditions please visit: AscentFunding.com/Ts&Cs. Rates are effective as of 7/1/2024 and reflect an automatic payment discount of either 0.25% (for credit-based loans) OR 1.00% (for undergraduate outcomes-based loans). Automatic Payment Discount is available if the borrower is enrolled in automatic payments from their personal checking account and the amount is successfully withdrawn from the authorized bank account each month. For Ascent rates and repayment examples please visit: AscentFunding.com/Rates. 1% Cash Back Graduation Reward subject to terms and conditions. Cosigned Credit-Based Loan student must meet certain minimum credit criteria. The minimum score required is subject to change and may depend on the credit score of your cosigner. Lowest rates require interest-only 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 repayment examples above, based on the amount of time you spend in school and any grace period you have before repayment begins.
College Ave
Editor’s Take
College Ave offers a solid all-around private loan product with a few unique features. Borrowers can choose an eight-year term, which is in addition to the typical five-, 10- and 15-year terms many lenders provide. Borrowers can also access an extended six-month grace period beyond the initial payment-free six months allowed after separating from school.
Pros & Cons
Interest rate estimate available without undergoing a hard credit check
International students can qualify with a co-signer who has U.S. citizenship or permanent residency
Long time period (210 days) before unpaid loans go into default
Details
Loan terms
5, 8, 10 and 15 years.
Loan amounts
$1,000 up to 100% of the school-certified cost of attendance
Eligibility
Applicants must have a minimum credit score in the mid-600s.
Forbearance options
Up to 12 months of forbearance is available, in three- to six-month increments.
Co-signer release policy
Available after 24 payments
*Borrowers with a co-signer who choose the shortest repayment term available and who make full monthly payments while in school qualify for the lowest rates.
1 – College Ave Student Loans products are made available through either Firstrust Bank, member FDIC or Nationwide Bank, member FDIC. All loans are subject to individual approval and adherence to underwriting guidelines. Program restrictions, other terms, and conditions apply.
2 – All rates shown 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. Variable rates may increase after consummation.
3 – Cover up to 100% of your cost of attendance as certified by your school and less any other financial aid you might receive. Minimum $1,000.
Citizens Bank
Editor’s Take
Citizens Bank’s parent loan offers comparatively low interest rates, and borrowers can qualify for an interest rate discount of up to 0.50% if they have an existing account with the bank. (Student loans are available in all states, but checking and savings accounts are only available in Connecticut, Delaware, Massachusetts, Michigan, New Hampshire, New Jersey, New York, Ohio, Pennsylvania, Rhode Island and Vermont.)
Citizens Bank also offers a relatively rare loan modification program, introduced in spring 2020, that allows for reduced monthly payments for a period of 12 months. That’s in addition to the industry-standard 12 months of forbearance.
Pros & Cons
Maximum interest rate under 10%
Loan modification option in addition to standard forbearance
No origination fee
No rate estimate available without soft credit check
Non-U.S. citizens cannot apply
Details
Loan terms
5, 10 and 15 years
Loan amounts
$1,000 to $350,000 (depending on degree)
Eligibility
Parent applicants and students must be U.S. citizens. Students must attend school at least half-time.
Forbearance options
Up to 12 months throughout the life of the loan, provided in two-month increments
Co-signer release policy
Co-signers can be released from the loan after 36 payments.
Sallie Mae
Editor’s Take
Sallie Mae provides multiple payment reduction options for borrowers experiencing financial difficulty, including a one-year graduated repayment period after leaving school or an interest rate reduction. Students who attend school less than half-time also can qualify, which not all lenders allow.
International students may get a loan with the help of a U.S. citizen co-signer, but student borrowers cannot get a co-signer release unless they are U.S. citizens or permanent residents themselves by the time they request the release. Interest rates are also on the higher end.
Pros & Cons
No origination fee
Co-signer release available after 12 monthly payments
Only one loan term available
No rate estimate available with soft credit check
Details
Loan terms: 15 years
Loan amounts available: $1,000 up to 100% of the school-certified cost of attendance; no aggregate graduate student loan limit
Eligibility: International students can apply with a U.S. citizen co-signer. Borrowers are eligible if they’re attending full-time, half-time or less than half-time.
Forbearance options: Up to 12 months throughout loan term. Interest-only payment option for one year after leaving school.
Co-signer release policy: Available after 12 on-time monthly payments
Summary: Best Student Loan Interest Rates
What Are Current Student Loan Interest Rates?
When you’re shopping for a student loan, you have two main options: federal and private student loans. Federal loans are a smart place to start for most borrowers since they offer relatively low fixed interest rates and other repayment benefits.
Federal Student Loans
For college students and their families looking for a loan to pay for school, federal loans may be a good choice. Notably, all borrowers who are eligible for a federal loan receive the same standardized interest rate, no matter their credit history or income.
Undergraduate students can qualify for a fixed-rate loan at 4.99%, while parents borrowing on behalf of an undergraduate child can qualify for a loan at 7.54%.
Private Student Loans
If you opt for private student loans, rates and terms can vary widely between lenders. Plus, your interest rate is based on several factors, including your credit history.
Although federal loans always have fixed interest rates, private student loan rates can be fixed or variable. Variable-rate loans usually have lower interest rates at first, but the rates can change over time along with market conditions.
As of February 2024, private student loans had fixed and variable interest rates as low as about 4%. However, only those with excellent credit and a reliable income can qualify for the lowest rates. Those with less-than-perfect credit could face interest fees as high as 14% or more.
How to Get the Best Student Loan Interest Rates
To qualify for the best interest rate for student loans, follow these steps:
Maximize federal student aid first. For most college students, federal student loans are a better option than private loans because they offer more repayment options and borrower protections. And because federal undergraduate loans don’t require credit checks or minimum income requirements, you’re likely to get a better rate with a federal loan than a private one.
Improve your credit. If you need to take out private loans, focus on improving your credit as much as possible. If you can, pay down your credit card balances and make all of your recurring payments on time.
Add a co-signer. Most undergraduate students will need a co-signer to qualify for a private student loan. But even if you can get one by yourself, adding a co-signer can be a good idea since it can help you get a better interest rate.
Choose a shorter loan term. The best interest rate for student loans is typically reserved for borrowers that choose shorter loan terms. To get a lower rate, opt for a repayment term of five to eight years; you’ll have a higher monthly payment, but your overall repayment cost will be much lower.
Comparison shop. Because rates can vary between lenders, spending some time researching lenders and requesting rate quotes can be a good use of your time. Shopping around will allow you to find the lowest rates available.
How Interest Rates Work in Federal vs. Private Student Loans
When you take out a student loan, you must repay the original amount you borrow along with interest. With federal student loans, interest rates are fixed and stay the same for the duration of the loan’s repayment period. Federal student loan interest rates are set annually by law and the same rates apply to all borrowers, regardless of income or credit score.
In comparison, private student loan rates are set by the lender. Private lending companies determine their rates based on certain economic benchmarks and their own unique lending policies.
What Affects Student Loan Interest Rates?
There are several variables that affect your interest rates on private student loans:
Loan term. You can usually choose a repayment term between five and 15 years on a private student loan. A longer term can be appealing because it will give you a smaller monthly payment, but lenders generally charge higher interest rates on longer loan terms.
Credit. Lenders give the best interest rates on student loans to borrowers with good to excellent credit, which typically equates to a credit score between 740 and 850.
Co-signer. If your credit score is below the acceptable range, you may qualify for a lower rate by adding a co-signer with excellent credit to your loan application.
Methodology
We scored 15 lenders that make the most loans by volume across 18 data points in the categories of interest rates, fees, loan terms, hardship options, application process and eligibility. We chose the 10 best to display based on those earning 3.5 stars or higher.
The following is the weighting assigned to each category:
Interest rates: 25%
Hardship options: 25%
Application process: 15%
Fees: 15%
Loan terms: 10%
Eligibility: 10%
Specific characteristics taken into consideration within each category included number of months of forbearance available, economic hardship repayment options available beyond traditional forbearance, perks like cash-back rewards upon graduation, discounts, time to default, disclosure of credit score and income requirements and other factors.
In some cases, lenders were awarded partial points, and a maximum of 5% of the final score was left to editorial discretion based on the quality of consumer-friendly features offered.
To learn more about how Forbes Advisor rates lenders, and our editorial process, check out our Loans Rating & Review Methodology.
Compare Student Loan Rates In Minutes
Compare rates from participating lenders via Credible.com
Frequently Asked Questions (FAQs)
What is a good interest rate on a student loan?
What counts as a good interest rate on a student loan depends on your credit profile and larger economic conditions.
As of the 2022-2023 academic year, federal undergraduate loans charge an interest rate of 4.99%. Private student loans for undergraduate students with fixed interest rates can be as low as about 4%. However, not all applicants can qualify for the best private student loan rates.
Will student loan interest rates go up?
In the past few years, interest rates have increased substantially. For example, federal student loans for undergraduate students had interest rates of 2.75% in the 2020-21 school year. In 2023, the rate is 4.99%.
Rates on federal and private student loans could increase even more, especially if the U.S. Federal Reserve continues to institute additional rate hikes.
Next Up In Student Loans
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