US Cuts Student Loan Rates

The Trump administration announced on Thursday that it will offer federal student loan borrowers who sign up for autopay a 1-percentage-point reduction on their interest rate, starting July 1. 25-percentage-point discount. Federal student loan holders who aren't already enrolled in autopay have until Sept. 30 to do so, if they want to benefit from the lower interest rate.

The discount will last through June 30, 2028. "The Trump Administration is making student loan repayment easier than ever, and borrowers should not wait to take advantage of this temporary interest rate reduction to stay on track for key student loan benefits," Under Secretary of Education Nicholas Kent said in a statement. " The law narrows borrowers' affordable repayment plans and other relief measures. 6 trillion, according to the Congressional Research Service.

S. Department of Education. Consumer advocates usually recommend that federal student loan holders seize the opportunity for a lower interest rate by signing up for automatic payments. Doing so can also help you avoid missing a payment.

But some student loan borrowers have also run into problems with autopay. For example, CNBC wrote in 2023 about a woman who was supposed to have a $0 student loan payment under the plan she was enrolled in but was charged $2,074 one month. The Consumer Financial Protection Bureau has reported on similar errors. This is a breaking news story.

Please check back for updates.