I’m looking to better understand the interest rates for student loans. What are the current interest rates for federal and private student loans? How are these rates determined, and what factors can influence them? Additionally, how do interest rates impact the overall cost and repayment of student loans?
Federal student loan rates are set by the government and are fixed. Currently around 5.50% for undergrads and 7.00% for Grad PLUS loans. Private loans vary based on your credit and lender, ranging from 4% to 12%. Higher rates mean paying more over time, so it’s good to understand how these rates impact your total repayment.