Getting a student loan with a low interest rate can save you thousands over the life of your loan. Even a difference of one or two percentage points can significantly reduce your monthly payment and total repayment cost.
Federal student loans currently offer fixed rates starting at 6.39% for undergraduate borrowers, while some private student loan lenders advertise starting rates below 5% for well-qualified borrowers or borrowers applying with a cosigner. Federal student loans are usually the best starting point for most borrowers, but private lenders may offer lower rates for students with strong credit or qualified cosigners.
In this guide, we compare the best low-interest student loans, explain how student loan rates work, and show how to improve your chances of qualifying for the lowest rate possible.
Table of Contents
- What is considered a low student loan interest rate?
- How student loan interest rates work
- Fixed vs. variable rates
- Best low-interest private student loans
- Best overall private student loans: College Ave
- Best student loan for cosigners: Sallie Mae
- Best graduation reward: Ascent
- Best student loan repayment perks: Earnest
- Best student loan for grad students: SoFi®
- Best student loan for multi-year approval: Citizens Bank
- Best student loan advisors: ELFI
- Best student loan for Texas borrowers: Brazos
- How to get a lower student loan interest rate
- Can refinancing lower your student loan interest rate?
- How much can a lower student loan rate save you?
- Federal vs. private student loans with low rates
- What credit score do you need for the lowest student loan rates?
- What are the cheapest student loans?
- FAQ
- Final takeaways
What is considered a low student loan interest rate?
A low student loan interest rate generally means:
- Under 6% for private student loans
- Below current federal student loan rates
- Significantly lower than the national private loan average
Borrowers with excellent credit or strong cosigners typically qualify for the lowest private student loan rates.
For the 2025 – 2026 school year:
- Many private lenders advertise starting variable rates below 5%
- Federal undergraduate student loans have a fixed rate of 6.39%
How student loan interest rates work
Student loan interest is the cost you pay to borrow money for school. Your interest rate affects:
- Your monthly payment
- Your total repayment cost
- How quickly your balance grows
Private student loan rates are usually based on:
- Credit score
- Income
- Debt-to-income ratio
- Cosigner strength
- Repayment term
- Fixed vs. variable rate selection
Federal student loan rates are set annually by Congress and apply equally to eligible borrowers regardless of credit score.
Private student loan rates vary widely because lenders price loans based on risk. Borrowers with higher credit scores, higher income, lower debt levels, and qualified cosigners typically receive the best offers. Loan type, repayment term, and whether you choose a fixed or variable rate can also affect pricing.
Fixed vs. variable student loan rates
One of the biggest decisions when comparing student loans is whether to choose a fixed or variable interest rate. Fixed rates stay the same over the life of the loan, while variable rates can change over time based on market conditions.
The right choice if you’re looking for student loans with low interest rates depends on your risk tolerance, repayment timeline, and whether you prioritize predictable payments or lower starting rates.
| Fixed rates | Variable rates |
|---|---|
| Stay the same over the life of the loan | Can rise or fall over time |
| Predictable monthly payments | Lower starting rates possible |
| Less risk during repayment | Payments may increase later |
| Better for long-term stability | Better for short-term repayment strategies |
Which is better?
Fixed rates are usually safer for most borrowers because payments remain predictable. Variable rates may save money initially, but they can become more expensive if market rates rise.
Best low-interest private student loans
The lenders below offer some of the most competitive student loan options for borrowers with strong credit or qualified cosigners. While the lowest advertised rates are typically reserved for highly qualified applicants, comparing multiple lenders can help you find the best combination of rates, repayment flexibility, borrower benefits, and approval requirements.
When reviewing lenders, look beyond the starting APR. Features such as repayment options, cosigner release, grace periods, fees, and borrower protections can also affect the total cost and long-term value of your loan.
Best overall private student loans: College Ave
College Ave is one of the strongest overall options for borrowers seeking competitive private student loans and flexible repayment options. Choose from several in-school repayment options, including deferred, interest-only, flat monthly, or full principal-and-interest payments.
The lender also stands out for its broad loan availability, with options for undergraduate, graduate, career, parent, and professional students. You can prequalify with a soft credit check, and many students apply with a cosigner to improve their chances of approval.
What we like
- Multiple in-school repayment options
- Soft-credit prequalification available
- Loans for undergraduate, graduate, career, and professional programs
- No origination or prepayment fees
What to keep in mind
- Most undergraduate borrowers need a cosigner
- Cosigner release takes longer than with some competitors
Best student loan for cosigners: Sallie Mae
Sallie Mae is a strong option for borrowers applying with a cosigner and students who want broad eligibility flexibility. The lender offers loans for undergraduate, graduate, and career training programs, including students enrolled less than half-time.
Sallie Mae also offers one of the faster cosigner release pathways among major private student loan lenders, which may appeal to borrowers who want to eventually remove their cosigner from the loan.
What we like
- Available for many degree and training programs
- Flexible enrollment requirements
- Faster cosigner release than some competitors
- No origination or prepayment fees
What to keep in mind
- Most borrowers still need a cosigner
- Fewer repayment term options than some competitors
Best graduation reward: Ascent
Ascent may appeal to borrowers who want flexible loan structures and added borrower perks. The lender offers both cosigned and some non-cosigned student loan options, which can help students with limited credit history.
Ascent also stands out for its graduation reward and career-focused member benefits, including resources designed to support students after school.
What we like
- Cosigned and some non-cosigned loans available
- Graduation rewards available
- No origination or disbursement fees
- Flexible repayment structures
What to keep in mind
- Non-cosigned loans can be harder to qualify for
- Borrowers without strong credit may still need a cosigner
Best student loan repayment perks: Earnest
Earnest is a good fit for borrowers who want flexible repayment tools and borrower-friendly features. The lender offers customizable repayment terms and allows eligible borrowers to skip one payment each year without penalty.
Borrowers may also appreciate Earnest’s longer grace period and flexible payment management options after graduation.
What we like
- Skip-a-payment feature available
- Longer grace period than many competitors
- Flexible repayment term options
- No fees
What to keep in mind
- Strong credit or a cosigner is often needed
- Not available in every state
Best student loan for grad students: SoFi®
SoFi is a strong option for graduate students and borrowers who want access to member benefits beyond student loans. Eligible borrowers may qualify for perks such as career coaching, financial planning tools, and member rewards programs.
The lender also offers flexible repayment options and broad availability of graduate loans across multiple degree programs.
What we like
- Member benefits and career resources
- Broad graduate and professional loan options
- Flexible repayment structures
- No origination fees required
What to keep in mind
- Approval can be difficult without strong credit
- Cosigner release options are more limited than some competitors
Best student loan for multi-year approval: Citizens Bank
Citizens Bank stands out for its multi-year approval feature, which may reduce the need for repeat hard credit inquiries and applications every school year. Borrowers who qualify may receive approval for future funding without completing a full new application annually.
Citizens offers student loans for undergraduate, graduate, parent, and professional borrowers.
What we like
- Multi-year approval available
- Broad loan availability
- No origination fees
- Autopay discount available
What to keep in mind
- Strong credit or a cosigner is often required
- Fewer unique repayment perks than some competitors
Best student loan advisors: ELFI
ELFI may be a good fit for borrowers who want a more guided borrowing experience. The lender pairs applicants with dedicated student loan advisors who can help borrowers understand repayment options and navigate the application process.
ELFI also offers flexible loan structures for undergraduate, graduate, and parent borrowers.
What we like
- Dedicated student loan advisors
- Flexible repayment options
- No application or origination fees
- Strong customer service reputation
What to keep in mind
- Excellent credit is usually needed for the best offers
- Fewer borrower perks than some competitors
Best student loan for Texas borrowers: Brazos
Brazos may appeal to borrowers in Texas who want nonprofit-backed student loan options and borrower-friendly repayment flexibility. The lender offers undergraduate, graduate, parent, and refinance loans with several repayment structures available.
Borrowers may also benefit from completion rewards and principal reduction programs tied to graduation milestones.
What we like
- Nonprofit lender structure
- Borrower rewards available
- Flexible repayment options
- No origination fees
What to keep in mind
- Limited availability compared to national lenders
- Some loan options are restricted by residency or school eligibility
How to get a lower student loan interest rate
Getting a student loan with a low interest rate can save you thousands over the life of your loan. While federal student loan rates are fixed by the government, private student loan rates depend heavily on your financial profile and the lender you choose.
Here are some of the best ways to improve your chances of qualifying for a lower student loan rate.
Don’t forget to shop around! Rates can vary significantly between lenders for the same borrower, which is why prequalifying with multiple lenders is important.
Improve your credit score
Your credit score is one of the biggest factors lenders use when setting private student loan rates. Borrowers with higher credit scores typically qualify for better rates and terms because they’re viewed as lower risk.
You may be able to improve your credit score by:
- Making payments on time
- Paying down existing debt
- Keeping credit card balances low
- Avoiding unnecessary hard credit inquiries
- Reviewing your credit report for errors
Even small credit score improvements can sometimes help you qualify for more competitive loan offers.
Apply with a cosigner
Applying with a creditworthy cosigner can significantly improve your approval odds and may help you secure a lower interest rate. Many undergraduate students have limited credit history or income, so lenders often rely on the cosigner’s financial profile during underwriting.
A strong cosigner typically has:
- Good to excellent credit
- Stable income
- Low debt-to-income ratio
- Positive payment history
Some lenders also offer cosigner release after a period of on-time payments.
Choose a shorter repayment term
Shorter repayment terms often come with lower interest rates because lenders take on less long-term risk. While monthly payments may be higher, borrowers usually pay less total interest over the life of the loan.
For example, a five-year term may carry a lower rate than a 15-year term for the same borrower profile.
Before choosing a shorter term, make sure the monthly payment fits comfortably within your budget.
Enroll in autopay
Many student loan lenders offer an autopay discount when you enroll in automatic monthly payments. The discount is usually small, but it can still reduce your total interest cost over time.
Autopay may also help you:
- Avoid missed payments
- Protect your credit score
- Simplify repayment management
Most lenders automatically apply the discount after enrollment.
Compare multiple lenders
Student loan rates can vary significantly from one lender to another, even for the same borrower. Comparing multiple lenders gives you a better chance of finding a lower rate and stronger repayment terms.
Many lenders allow borrowers to prequalify with a soft credit check, which means you can compare potential offers without affecting your credit score.
When comparing lenders, consider:
- Fixed vs. variable rates
- Repayment terms
- Fees
- Cosigner release policies
- Grace periods
- Borrower protections
Consider refinancing later
If you can’t qualify for a low rate right now, refinancing later may help reduce your interest rate after graduation. Many borrowers improve their credit profiles once they:
- Graduate
- Start working full-time
- Build payment history
- Increase income
Refinancing replaces your existing student loans with a new private loan, ideally with a lower interest rate or better repayment terms.
Borrowers with federal student loans should be cautious before refinancing because refinancing permanently removes federal benefits such as income-driven repayment plans and loan forgiveness programs.
Can refinancing lower your student loan interest rate?
Yes, refinancing may help borrowers qualify for lower rates after graduation, especially if they:
- Improve their credit
- Increase income
- Reduce debt
- Apply with a cosigner
Check out the Best Student Loan Refinance Lenders.
How much can a lower student loan rate save you?
Even a small difference in your student loan interest rate can have a major impact on your long-term repayment costs. Lower rates reduce the amount of interest that builds over time, which can lower both your monthly payment and the total amount you repay.
The examples below show how much total interest costs can change based on the interest rate you receive.
| Loan balance | Interest rate | Total interest paid |
|---|---|---|
| $50,000 | 8% | ~$22,797 |
| $50,000 | 5% | ~$13,640 |
| $100,000 | 8% | ~$45,593 |
| $100,000 | 5% | ~$27,279 |
Federal vs. private student loans with low interest rates
Federal and private student loans work differently, and the lowest-rate option depends on your financial situation, credit profile, and borrowing goals. Federal loans offer fixed government-set rates and built-in borrower protections, while private lenders may offer lower starting rates to highly qualified borrowers.
The comparison below highlights some of the biggest differences between federal and private student loans.
| Federal loans | Private loans |
|---|---|
| Fixed government-set rates | Credit-based rates |
| No cosigner required | Often lower starting rates |
| Income-driven repayment available | Fewer borrower protections |
| Forgiveness options available | Best for borrowers with strong credit |
Read More Federal Direct Loans
Which is better?
Federal student loans are usually the best starting point for most borrowers because they offer fixed interest rates and protections that private lenders typically don’t match. Federal benefits can include:
- Income-driven repayment plans
- Federal deferment and forbearance options
- Student loan forgiveness programs
- No credit check for most undergraduate loans
However, private student loans may offer lower starting rates for borrowers with strong credit or qualified cosigners. Private loans can also help borrowers cover funding gaps after reaching federal borrowing limits.
In general:
- Federal loans are often better for borrower protections and repayment flexibility
- Private loans may be better for borrowers focused on securing the lowest possible rate
Many students use a combination of both.
Watch below: Federal vs. Private Student Loans
What credit score do you need for the lowest student loan rates?
Most lenders reserve the lowest student loan rates for borrowers or cosigners with:
- Credit scores above 720
- Stable income
- Low debt-to-income ratios
Borrowers with limited credit history may still qualify, but often at higher rates.
What are the cheapest student loans?
Federal undergraduate student loans are often the cheapest option for many borrowers because rates are fixed and don’t depend on credit scores. Among private lenders, the cheapest student loan rates usually go to borrowers with excellent credit or strong cosigners.
FAQ
What is a good student loan interest rate?
A good student loan interest rate is generally one that falls below current federal student loan rates or below the national average for private student loans. For many borrowers in 2026, rates under 6% are considered competitive, especially for private student loans.
Borrowers with excellent credit or strong cosigners typically qualify for the best private student loan rates.
What is the lowest student loan rate available?
The lowest student loan rates are usually offered by private lenders to borrowers with excellent credit, stable income, and low debt-to-income ratios. Some lenders advertise starting rates below current federal student loan rates, though the lowest advertised rates are reserved for highly qualified borrowers.
Federal undergraduate student loans often remain one of the cheapest options overall because rates are fixed and don’t depend on credit scores.
Are federal or private loans cheaper?
Federal student loans are often cheaper for borrowers with average or limited credit because rates are standardized and don’t depend on creditworthiness. Private student loans may offer lower starting rates for borrowers with great credit or qualified cosigners.
The cheapest option depends on your financial profile, repayment goals, and whether you value federal borrower protections.
Can I lower my student loan interest rate later?
Yes, many borrowers lower their student loan interest rate later through refinancing. Borrowers may qualify for better rates after improving their credit score, increasing their income, or building a stronger payment history.
Refinancing replaces your current loans with a new private loan that may offer a lower rate or different repayment terms.
Do cosigners help lower rates?
Yes, applying with a cosigner can help many borrowers qualify for lower student loan rates. Lenders often offer better terms when a cosigner has strong credit, stable income, and a positive financial history.
Cosigners are especially helpful for undergraduate students or borrowers with limited credit history.
Are variable student loan rates risky?
Variable student loan rates can be risky because they may increase over time. While variable rates often start lower than fixed rates, they can rise if market interest rates increase.
Borrowers who want stable monthly payments usually prefer fixed rates, while borrowers planning to repay loans quickly may consider variable rates to take advantage of lower starting costs.
Should I choose a fixed or variable student loan rate?
A fixed student loan rate is usually the safer option for most borrowers because your interest rate and monthly payment stay the same throughout repayment. Fixed rates make budgeting easier and protect you if market interest rates rise in the future.
Variable rates sometimes start lower than fixed rates, which may help reduce your initial monthly payment. However, variable rates can increase over time, causing your payment and total repayment cost to rise.
In general:
- Fixed rates are better for borrowers who want stable, predictable payments
- Variable rates may work better for borrowers planning to repay loans quickly or who expect interest rates to fall
If you’re unsure which option to choose, fixed-rate student loans are typically the lower-risk choice.
Final takeaways
Getting a low student loan interest rate can make a major difference in how much you repay over time. Even a slightly lower rate may reduce your monthly payment and save you thousands in total interest.
Federal student loans are often the best starting point because they offer fixed rates and valuable borrower protections. Private student loans may provide lower starting rates for borrowers with strong credit or qualified cosigners, especially when comparing multiple lenders and taking advantage of discounts such as autopay.
Before borrowing, compare lenders carefully, review repayment terms, and consider how your future income will support repayment. If you can’t qualify for a competitive rate today, refinancing later may help you secure better terms after graduation.
About our contributors
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Written by Zina KumokZina Kumok is a personal finance writer dedicated to explaining complex financial topics so real people can understand them. As a former newspaper reporter, she has covered everything from murder trials to the Final Four.
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Edited by Kristen Barrett, MATKristen Barrett is a managing editor at LendEDU. She lives in Cincinnati, Ohio, with her wife and their pack of senior rescue dogs. She has edited and written personal finance content since 2015.
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Reviewed by Erin Kinkade, CFP®Erin Kinkade, CFP®, ChFC®, works as a financial planner at AAFMAA Wealth Management & Trust. Erin prepares comprehensive financial plans for military veterans and their families.