Trump administration temporarily cuts student loan interest rates for borrowers on autopay
The temporary change is meant to boost repayment rates as 42.8 million borrowers face new repayment rules, officials said.
- On Thursday, the Education Department announced a temporary 1% interest rate discount for federal student loan borrowers enrolled in auto-pay, effective July 1, 2026, through June 30, 2028.
- Education Under Secretary Nicholas Kent reported that auto-pay participation plummeted from roughly 83% in 2019 to 40% by late 2025, prompting the department to revive enrollment incentives.
- The initiative will cost an estimated $6 billion and reduce undergraduate interest rates from 6.39% to 5.39% for eligible borrowers who enroll in auto-pay by Sept. 30.
- Starting July 1, the discount accompanies broader federal student loan changes, including implementation of the new Repayment Assistance Plan that replaces previous income-driven repayment options.
- The Trump administration has signaled a stricter approach to student lending, with Education Secretary Linda McMahon stating last year that taxpayers should no longer serve as collateral for irresponsible loan policies.
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Feds plan for student loan interest rates could cost taxpayers
(The Center Square) – The U.S. Department of Education is reducing student loan interest rates for borrowers, but critics argue the move could cost taxpayers billions of dollars.
abc 13 Houston
Student loan borrowers can qualify for lower rates if they use autopay
Student loan rates are about to go down by 1% for millions of borrowers enrolled in automatic payments.
US Education Department offers 2-year trim on student loan interest rates • SC Daily Gazette
The U.S. Education Department will temporarily lower interest rates for student loan borrowers who use the auto pay feature. (Photo illustration via Getty Images) WASHINGTON — The U.S. Department of Education will temporarily reduce interest rates for federal student loan borrowers enrolled in auto pay starting July 1, the agency announced Thursday. Borrowers who enroll in auto pay — the optional feature that allows a borrower to have their mon…
Student loan borrowers can get 1% interest rate cut with one simple change
Federal student loan borrowers enrolled in automatic payments will be eligible for a 1% interest rate reduction beginning July 1, the Department of Education said.Borrowers who are already enrolled in auto pay, or who sign up by Sept. 30, 2026, will receive the temporary rate reduction through June 30, 2028.Borrowers enrolled in auto pay currently receive a 0.25% interest rate reduction.The department said the initiative is meant to make repayme…
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