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Student loan borrowers can get lower interest rates
CNBC • • business
Key Points:
- The U.S. Department of Education is offering a temporary 1 percentage point interest rate discount on federal Direct Loans for borrowers who enroll in autopay by September 30, 2026, lasting through June 30, 2028.
- Eligible loans must be Direct Loans disbursed on or after July 1, 2012, and borrowers must have their loans in good standing; those in default must rehabilitate their loans to qualify.
- Borrowers already enrolled in autopay will automatically receive the discount, which is significantly larger than the current 0.25 percentage point autopay discount.
- The discount excludes Federal Family Education Loans (FFEL) and private student loans, and borrowers must remain enrolled in autopay to maintain the reduced rate.
- While autopay enrollment is generally recommended to reduce interest rates and avoid missed payments, borrowers should monitor their accounts closely due to reported billing errors and promptly contact servicers to resolve any discrepancies.
