Student Loan Interest: by the numbers
Federal student loan rates went up again this year, the third straight year they've climbed. Here's what that actually costs you, and the one loan type that's now gone for good.
Why it matters
Every loan disbursed since July 1, 2026 locks in a fixed rate for the life of that loan. Get it wrong now, and you're paying for it for a decade or more.
By the numbers
Rates are set once a year, in May, based on a Treasury auction plus a fixed markup Congress sets for each loan type. Undergrad gets a 2.05 point markup. Grad loans get 3.60 points. PLUS loans get 4.60 points, the biggest of the three.
Zoom out: Rates have climbed three years running. The undergrad rate alone is up roughly 65% since 2021.
What does this mean for you?
Apply for your loan BEFORE rates go up if you can. Talk to your financial aid office about how early you can apply for aid if you know you're going to need another loan for your next semester.
The catch for grad students
Grad PLUS vs. Parent PLUS, quickly
These two get confused constantly. Here's the actual difference.
Who borrows
Grad PLUS was for grad and professional students borrowing for their own education. Parent PLUS is for parents borrowing on behalf of a dependent undergrad.
Status
Grad PLUS has been eliminated for new borrowers. Parent PLUS is still around, now capped at $20,500 a year and $65,000 total per student.
Who owes the money
The person who signs is the person who owes it. A parent's Parent PLUS balance never transfers to the student, even after graduation.
Eligibility
Both require a credit check. Neither is based on financial need.
What it costs in real terms
A private lender might offer a fixed rate in the mid-4% range to a borrower with strong credit. On a $10,000 loan over 10 years, the gap between a 6.52% federal rate and a 4.25% private rate adds up to roughly $1,345 in extra interest. For grad borrowers, the gap is wider still, since federal grad rates start nearly two points higher than undergrad.
The bottom line
“Federal loans are easier to qualify for. Private loans can be cheaper, if your credit supports it. Know which situation you're actually in before you sign anything.”
Ready to plan your borrowing?
Use our step-by-step calculator to find your exact borrowing limits and explore your options under the 2026 rules.
Sources:Experian; U.S. Department of Education, Federal Student Aid; The Institute for College Access & Success (TICAS)