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Private Student Loan Rates: June 17, 2025 – Loan Rates Drop
- Average interest rate on 10-year fixed-rate private student loans dropped last week, with rates now at 6.90% for borrowers with credit scores of 720+.
- Current average fixed rate on a 10-year loan is 0.95 percentage points lower than last year.
- Borrowers financing $20,000 at today's rate would pay around $231 per month and $7,743 in total interest over 10 years.
- Average variable rates on five-year loans also decreased to 7.88%.
- Private lenders offer options of fixed or variable rates; fixed rates may be preferred for stability, while variable rates can be advantageous if aiming for quick loan repayment.
- Consider federal student loans first due to lower interest rates and better repayment options before opting for private student loans.
- When applying for private student loans, evaluate overall costs, assistance options for payment difficulties, and borrowing limits based on credit history.
- It's recommended to borrow conservatively and explore all federal aid options before considering private loans.
- Private student loans can be beneficial without annual borrowing limits, fast application processes, competitive interest rates, and potential grace periods for repayment.
- Some private lenders extend loan options to international students who are not eligible for federal loans, providing funding for education in the U.S.
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