vs Last Year
−0.29 pts
Second annual cut from the 2024 peak.
Federal Student Loan Rate
Undergrad Direct · 2026–2027 School Year
6.10%
-0.29 pts vs. 2025–26 (6.39%)
Past 5 yearsRange 2.75 – 6.53
Graduate7.65%
Parent PLUS8.70%
2020 Low2.75%
The 2026–27 federal undergrad rate dropped 29 bps to 6.10% — the second consecutive annual cut after peaking at 6.53% in 2024. At today's rate, $40K borrowed costs ~$13,165 in interest over 10 years.
Historical trend
Annual reset, July 1.
Source: U.S. Department of Education
The long view: since 2006
Twenty years of federal student loan rates.
Peak 6.80% · 2006–07Trough 2.75% · 2020–21Today 6.10%
How today stacks up
vs 2020 Low
+3.35 pts
Today's borrower pays much more than the COVID-era cohort.
5-Yr Avg
5.40%
Today is 70 bps above the 5-yr mean.
Cap
8.25%
Statutory ceiling for undergrad federal loans.
Plan around this rate
Tools for student loan decisions.
About the Federal Student Loan Rate
Federal student loan rates reset every July 1, based on the high yield of the May 10-year Treasury auction plus a fixed margin. The rate you get when you originate the loan is fixed for the life of the loan — even if rates rise or fall later. This tracker shows the rate for Undergraduate Direct Subsidized and Unsubsidized loans, the most common federal loan type for undergrads.
How federal student loan rates are set
Formula since 2013: 10-year Treasury high yield (May auction) + 2.05%. Capped at 8.25%. Graduate loans add another 1.55% to the formula (3.60% margin). PLUS loans for parents add 2.55% (4.60% margin). The structure means student loan rates lag the broader rate environment by about a year — but once locked in, never change for that specific loan.
What today's rate means for borrowers
At 6.10%, $40,000 in new federal student loans costs about $443/mo over 10 years in total payments — including ~$13,165 in interest. The 2024–25 cohort locked in 6.53% (the cycle high); the 2020–21 cohort got 2.75% (the cycle low). The lower rate cohorts will pay $20K+ less over the life of identical loans.
Related trackers
Other live numbers that move with — or against — this one.
Frequently asked
What this number means, and what it doesn't.
July 1 each year. Loans disbursed before July 1 keep the prior rate; loans disbursed on or after July 1 get the new rate. The new rate is locked in for the life of those specific loans even if rates change later.
Almost always, yes. Federal loans offer income-driven repayment, deferment, forbearance, and forgiveness programs that private loans don't. Private loans may offer lower rates for borrowers with strong credit, but lose all the protections.
No — your rate was locked in when each loan was originated. A 2020 borrower locked in 2.75%; a 2024 borrower locked in 6.53%. New loans get the current rate but old loans keep theirs.
Public Service Loan Forgiveness (PSLF) forgives remaining federal student loan balance after 120 qualifying payments while working for a qualifying employer. Income-Driven Repayment (IDR) forgives after 20–25 years. These are major reasons to keep loans federal.
Methodology
Source
Pulled from U.S. Dept. of Education and cached on the EvvyTools server.
Update schedule
Refreshed automatically by our cron whenever the upstream source publishes a new value. Historical values are not revised after publication.
How we compute
Display value is the raw published number, unrounded. Comparison stats use the closest available reference date. We never edit the underlying data.