What Is the Average Student Loan Interest Rate in 2025?

Interest on student loans adds up quickly, so it’s important to understand rates before you borrow. Federal student loan rates currently range from 6.39% to 8.94%, while fixed private student loan rates vary more widely — from 2.85% to 17.99% on the Credible marketplace. Because interest accrues daily, even a small rate difference can cost you thousands of dollars over the life of your loan.

Here’s what to know about the average student loan interest rates in 2025, and how they can affect the total cost of your education.

Current student loan refinancing rates

What is the average interest rate for student loans?

The average student loan interest rate varies by loan type. Federal student loans have fixed rates that are set by Congress each year. Everyone gets the same rate, regardless of where they attend school or their financial situation. 

Private student loan rates can vary from lender to lender. They depend on multiple factors, including market conditions, your credit and income, and whether you apply with a cosigner. 

“With private loans, you will go through a credit check, so your credit score is going to be a determining factor in the rate you will pay,” says Joe Orsolini, president of College Aid Planners. 

Learn More: How Does Student Loan Interest Work?

Average federal student loan interest rates

Federal student loans come with fixed rates that stay the same over the life of your loan. Congress sets these rates annually, so the rate you get depends on when you borrow and the type of loan you take out. 

“Federal loans have an advantage in that they do not look at your credit score,” says Orsolini. “The rate is the rate — the same for everyone.”

There are three types of federal student loans: Direct Subsidized Loans, Direct Unsubsidized Loans, and Direct PLUS Loans. Here are the current interest rates for federal student loans disbursed on or after July 1, 2025, and before July 1, 2026. 

Because these rates are fixed, they won’t change during repayment unless you refinance. Keep in mind, though, that refinancing federal loans turns them into private loans, and you’ll lose access to federal protections like income-driven repayment and forgiveness programs.

“Private loans may have lower interest rates from time to time, but they do not have federal loan forgiveness opportunities,” says Brian Safdari, founder of College Planning Experts. “Federal loans have more loan consolidation and loan repayment options, including income-based repayment options, which you do not get with private loans.”

For this reason, it’s generally best to take out federal student loans before considering private loans, since they often offer better rates and more flexible repayment options.

Average private student loan interest rates

Interest rates on private student loans can vary widely. For example, private lenders on the Credible platform offer fixed-rate APRs from 2.85% to 17.99%, and variable-rate APRs from 4.13% to 17.99% as of October 2025.

As of October 6, 2025, borrowers with credit scores of 720 or higher who shopped through the Credible marketplace saw an average rate of 7.29% for 10-year fixed student loans and 8.44% for five-year variable-rate loans.

Factors that influence your private student loan rate

The interest rate you get on a private student loan depends on a variety of factors, including:

• Your financial profile: Having a strong credit score and a high, stable income can help you qualify for a lender's best rates, since you're considered a less risky borrower.
• Whether you apply with a cosigner: Adding a creditworthy cosigner to your application, who shares responsibility for the loan, can also help you get a better rate.
• Fixed vs. variable rates: Private student loan rates can be fixed or variable. Variable rates sometimes start out lower than fixed rates, but they could increase over time.
• Your repayment term: Private lenders often offer lower rates to borrowers who opt for a shorter repayment term.
• The lender you choose: Each private lender sets its own rates, so your offers could vary from one lender to another.
• Market conditions: Private student loan rates are influenced by the federal funds rate, which is guided by the Federal Reserve. The Federal Reserve typically adjusts its target for the federal funds rate in response to economic conditions, such as inflation and unemployment.

How credit score affects your student loan rate

Your credit score plays a significant role in determining the rate you get on a private student loan. It represents your history of managing debt, such as credit cards and loans, and typically ranges from 300 to 850.

A higher score shows that you’ve handled credit well and are less risky to lenders, while a lower score can signal late payments or limited credit history. Private lenders generally reserve their lowest rates for borrowers with strong credit and charge higher rates to those with weaker credit.

If your credit isn’t where you want it to be, applying with a cosigner can help. About 84% of students applied for private student loans with a cosigner in 2024, according to Credible marketplace data. Choosing someone with a strong credit profile can also help you qualify for a lower rate.

Before applying, it’s also worth taking time to build your credit. Work on paying down existing debt, making on-time payments, and keeping your credit utilization low to improve your score and help you qualify for better rates.

Refinancing may help you access lower rates 

Refinancing your student loans can help you secure a lower interest rate and save money over time. When you refinance, you replace one or more existing loans with a new loan that ideally comes with better terms.

Like private student loans, refinancing lenders offer their lowest rates to borrowers with strong credit. You can also apply with a cosigner to help qualify for a better rate.

Refinancing makes sense if it will reduce your total borrowing costs, but it’s not the right move for everyone. Refinancing federal student loans converts them into private loans, which means you’ll lose access to federal benefits such as income-driven repayment plans and forgiveness programs.

If you rely on those protections, consider keeping your federal loans as they are. But if you have high-interest private loans or don’t need federal benefits, refinancing could be a smart way to lower your rate and save money.