What are Student Loan Interest Rates

The interest rate is a percentage of a sum of loan money that is charged to a borrower by a lender for the use of that money over a pre-determined period of time. Interest usually continues to be charged until the loan is paid in full. Student loan rates vary by product and lender so compare student loan options before applying.

Below you will find an overview of various interest rates by various education loan program. To the left you will find links to more detailed rate information by student loan product. As it is the most popular loan program, and offers the best rates, we will cover the federal Stafford Loan rates first...

Student Loan Rates Introduction

Stafford Loan Interest Rates

Academic Year Subsidized Rates Unsubsidized Rates Graduate Rates
2011-12 3.40% 6.80% 6.80%
2012-13 3.40% 6.80% 6.80%
2013-14* 3.86% 3.86% 5.41%
Current Stafford Loan interest rates in effect from 07/01/2013 to 06/30/2014
*These rates have been updated to reflect the new student loan interest rate legislation that went into effect on August 9, 2013. Stay up-to-date on interest rate changes and Stafford loan news at StudentLoanNetwork.com.

PLUS Loan Interest Rates

Currently, Parent and Graduate PLUS loans originated in the 2014-2015 academic year are set at 7.21% fixed APR. To learn more about PLUS loans, visit: PLUS Student Loans for College.

Perkins Loan Interest Rates

Perkins Loans currently carry a 5 percent interest rate. To learn more, visit our Perkins Loans page.

Alternative Student Loan Interest Rates

Private student loan interest rates are determined differently than federal student loan interest rates. Typically, banks offer borrowers a variable rate (either the LIBOR rate or or Prime Rate) plus an additional margin added on. Interest is charged from the day the loan is made. You can typically either start repaying the loan right away or defer payment while you are in school. Interest will accumulate and be added to the loan balance at graduation or 6 month later - when repayment typically begins. Again, all private student loan programs are different, so consider each one carefully.