Low-Interest Student Loans: Where to Find the Best Rates in July 2025

If you’re taking out student loans, scoring a low interest rate could save you thousands. It affects your monthly payments, your total repayment amount, and even how soon you can pay off the loan. Whether you’re looking at federal or private loans, securing the lowest rate possible should be a top priority.

According to the most recent data from Credible, the average interest rate for a five-year variable-rate private student loan for borrowers with credit scores of 720 or better was 8.92%, For 10-year fixed-rate private loans, the average was 9.12%.

In comparison, federal student loans for the 2025 – 2026 school year have a fixed rate of 6.53% for undergraduate loans.

Finding a student loan with a lower-than-average interest rate can help you reduce your monthly payments and save money over time. The lenders below offer fixed and variable rates that fall below the current national average as of July 2025.

Table of Contents

1. What’s a low student loan rate, and how can you get one?
   1. Best student loans with low interest rates
2. Federal student loans vs. private loans with low interest rates
3. Payments on low-interest student loans
4. What if you can’t get a low interest rate?

What’s a low student loan rate, and how can you get one?

Now that you know where federal and private student loan interest rates stand, the next step is figuring out whether you qualify for something better—and how to get there.

Even a small difference in interest rates can have a major impact on your total loan cost. For example, if you borrow $50,000 over 10 years, a 5% rate would cost you about $9,000 less in interest than an 8% rate.

So what qualifies as a low-interest student loan in July 2025? Anything noticeably below current federal and private benchmarks—especially in the 4% to 6% range—is considered competitive. That’s typically only available to borrowers (or cosigners) with excellent credit.

Best student loans with low interest rates

The lenders below offer interest rates that fall below the July 2025 national averages for well-qualified borrowers.

Lender	Rates (APR)^	Best for	Our rating
College Ave	0.94% – 12.99%	Private student loans	5.0/5
Sallie Mae	2% – 12.35%	Cosigners	4.8/5
SoFi	4.44% – 14.30% fixed rate with autopay	Member benefits	4.7/5
Earnest	1.34% – 11.44%	Large loans	4.7/5
Citizens Bank	1.86% – 9.39%	Multiyear approval	4.7/5
ELFI	3.69% – 14.22%	Student loan advisors	4.5/5
Ascent*	0.98% – 10.29%	Deferred repayment	4.4/5
Brazos	2.96% – 7.38%	Texas students and residents	4.4/5
Dept. of Education	6.53% – 9.08%	Federal student loans	None

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Tip

Remember that even a small difference in your interest rate can lead to big savings over time, especially if you’re borrowing a large amount or repaying over 10+ years.

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Here’s how to improve your chances of locking in a lower-than-average rate:

• Build your credit. Pay down debt, make payments on time, and clean up any errors on your credit report.
• Apply with a cosigner. A cosigner with strong credit and income can make a big difference in your approval odds and interest rate.
• Compare multiple lenders. Prequalifying with several lenders (via soft credit checks) can help you find the best rate without hurting your score.
• Look for autopay discounts. Many lenders offer a 0.25% rate reduction for enrolling in automatic payments.
• Choose fixed or variable rates wisely. Variable rates may start lower but can rise over time. Fixed rates provide more payment stability.

Read More

Best Private Student Loans

Low-interest private student loans vs. federal loans

Federal student loans are often the first stop for borrowers—and for good reason. They offer fixed interest rates, access to income-driven repayment plans, and options for deferment or forgiveness.

But federal rates aren’t always the lowest available. For the 2025 – 2026 school year, rates are:

Loan type	Rate	Borrower
Direct Subsidized or Unsubsidized Loan	4.99%	Undergraduate
Direct Unsubsidized Loan	6.54%	Graduate or professional
PLUS Loans	7.54%	Graduate

Read More

Federal Direct Loans

Payments on low-interest-rate student loans

Even a few percentage points can make a big difference in your total repayment cost. Here’s a quick example:

Loan amount and term	Total interest paid
$50,000 at 8% (10 years)	$22,797
$50,000 at 5% (10 years)	$13,640

That’s a savings of more than $9,000 just by securing a lower rate.

What if you can’t get a low interest rate?

If you’re offered a high interest rate and haven’t signed yet, don’t settle. Shopping around or adding a cosigner might unlock better options. It’s worth the effort—thousands of dollars could be on the line.

Already accepted a loan with a high rate? You may be able to refinance after graduation. Many borrowers qualify for better rates once they’ve built a credit history and steady income. Adding a cosigner at that point can also help.

To explore your options, check out our list of the best student loan refinance lenders.

Recap of low-interest student loans

Lender	Rates (APR)^	Best for	Our rating
College Ave	0.94% – 12.99%	Private student loans	5.0/5
Sallie Mae	2% – 12.35%	Cosigners	4.8/5
SoFi	4.44% – 14.30% with autopay	Member benefits	4.7/5
Earnest	1.34% – 11.44%	Large loans	4.7/5
Citizens Bank	1.86% – 9.39%	Multiyear approval	4.7/5
ELFI	3.69% – 14.22%	Student loan advisors	4.5/5
Ascent*	0.98% – 10.29%	Deferred repayment	4.4/5
Brazos	2.96% – 7.38%	Texas students and residents	4.4/5
Dept. of Education	6.53% – 9.08%	Federal student loans	None