Is a fixed interest rate or a variable interest rate the better option?

This depends on your debt management strategy. Typically, fixed rate loans tend to have higher interest than variable loans, but it allows you to plan ahead consistently. On the other end, variable interest can be lower, but this depends on several factors and can change your monthly repayment over the years.

Is it possible to get a low-interest student loan without a co-signer?

Yes, if you have an established and good credit history. This often applies if you’re opting for graduate, MBA, law or health-profession courses.

What is a good interest rate for a student loan?

A good interest rate is a low rate you can manage repayments throughout the loan term. However, keep in mind that what’s available to you will depend on your circumstances, especially in the case of private student loans. Private lenders will evaluate you based on your credit history, income, co-signer history and more.

What determines the interest rate on student loans?

When looking for private student loans with a low interest rate, keep in mind that lenders will look at a number of factors to determine your APR, such as your: - Credit history - Income or DTI ratio - Personal information, such as age and citizenship - School and program eligibility

How can I make my student loan payments more affordable?

If you want to get low-interest student loans, opting for federal student loans is the best route, as their APR is often lower than that of private lenders. This can help make payments more affordable. Additionally, if you opt to get a student loan with a private lender, you can use different strategies, such as: - Opt for interest rate discounts with automatic payments - Ask for a longer term - Negotiate with your lender

Best Low-Interest Student Loans in April 2023

The best low-interest student loans for borrowers are from the federal government. Generally, federal student loans offer lower interest rates than banks, along with a range of protections and benefits. However, keep in mind that federal student loans alone may not be able to cover the cost of higher education — this is where private student loans can help.

Private student loans originate from banks, credit unions and sometimes online lenders. However, these traditional lenders often have stricter underwriting processes and higher interest rates than federal loans. Finding private student loans with the lowest interest rates can help you best manage and pay off student debt after graduation.

WHAT WE’RE GEEKING OUT ON

College Ave Review
Earnest Review
Sallie Mae Review
SoFi Review
Current Rates for Federal Student Loans
How to Find Low-Interest Student Loans
Frequently Asked Questions About Student Loan Rates

College Ave Review

College Ave
Borrow up to 100% of the cost of your education with no origination fees or prepayment penalties.
- 3.49%–12.99%Fixed APR Range
- 1.19%–11.98%Variable APR Range
- $1,000 minimum, no maximumLoan Amount Range
- Not requiredCo-signer
College Ave is an online student loan lender offering various student loan products and refinancing since 2014 in 50 states and Washington, D.C. These loans are offered to both students and their parents or guardians for funding one’s higher education.
One of the best things about College Ave is that they offer student loans starting at $1,000 up to the total cost of tuition or attendance, which is not common among other lenders. Borrowers can also get a fixed APR as low as 3.49% and a variable APR as low as 1.19%, depending on their financial situation and other factors, along with various repayment options.
To save on interest, College Ave offers borrowers the opportunity to reduce their APR by 0.25% if they make automatic payments. Further, if a co-signer is present, they can be released after a specific time. A permanent disability or death can also trigger loan forgiveness at College Ave.
However, students must make satisfactory academic progress to be considered — and College Ave confirms with the school that requirements are met. Additionally, if you have any late payments, you will be charged a fee based on the monthly payment amount.
Pros
Borrow up to 100% of the cost of your education
No origination fees
No prepayment penalties
Automatic payment discounts available
Flexible repayment terms offered

Cons
Funding processing can take up to 10 business days
Late payment fees
Minimum GPA required
Fixed APR: 3.49%–12.99%
Variable APR: 1.19%–11.98%
Loan Amount: $1,000 minimum, no maximum
Co-signer: Not required
on College Ave Website

Earnest Review

Earnest
Pre-qualify for loans with no origination or late payment fees.
- 2.44%–7.99%Fixed APR
- 1.74%–7.99%Variable APR
- $1,000 upLoan Amount
- Allowed Co-signer
Earnest was founded in 2013 and began refinancing federal and private student loans in 2015. With customizable terms, Earnest launched private student loans for undergraduates and graduates in 2019. In addition, the company provides credit cards and personal loans to its clientele.
Earnest does not charge origination fees or late payment penalties like its competitors. Additionally, they allow you to pre-qualify, letting you know the potential rate you may qualify for without affecting your credit score. Once you’ve applied and are approved, your can receive your loan within two to five weeks.
It's possible to delay loan payments for up to nine months after graduation if you qualify for a grace period offered by the company. Earnest may also allow you to skip one payment every 12 months if you’ve been on time with your payments.
Pros
Pre-qualify with a soft credit check
Co-signers allowed
Payment skipping every 12 months
No origination fees
No late payment fees

Cons
Services are not available in all U.S. states
Student loans only available to full-time students
Borrowers must meet the state's majority requirement
Fixed APR Range: 2.44%–7.99%
Variable APR Range: 1.74%–7.99%
Loan Amounts: $1,000 up to the total cost of attendance
Grace Period: Deferment until 9 months after graduation
Co-signer: Allowed
on Earnest Website

Sallie Mae Review

Sallie Mae
U.S. Citizens, DACA and permanent residents: Get up to 100% of the cost of your education
- 3.50%–13.83% Fixed APR
- 1.37%–11.76%Variable APR
- $1,000 minimum, no maximumLoan Amount
- Allowed but not requiredCo-signer
Sallie Mae began in 1972 as a publicly listed banking corporation providing federal education loans. Currently, the company only gives private student loans to undergraduate, graduate and career training students who seek to finance part or all of their education. Students enrolled half-time or less than half-time can also get a student loan through Sallie Mae, which is unique among student loan lenders. The lender also provides loans to students taking online programs or studying abroad.
Your program of study and creditworthiness determines the APR, and you can select between a fixed or variable interest rate. While the fixed APR can range between 3.50% and 13.83%, the variable APR range is 1.37% to 11.76%. All students get a 0.25% discount on the APR for scheduling automatic payments and receive a four-month subscription to the Chegg learning platform for signing up. There is also a Sallie Mae parent loan for parents that want to fund their kids’ education.
The best part of a Sallie Mae student loan is the flexible repayment options (three in total) and the six-month grace period. Plus, students who are neither citizens nor permanent residents of the United States, including DACA students living or attending school in the country, may acquire loans with a co-signer. The co-signer, however, must be a U.S. citizen or permanent resident.
Pros
No Origination fees or any prepayment penalties
Flexible repayment plans offered
0.25% interest rate discount for automatic payments
Borrow up to 100% of the cost of your education
Colleges and scholarships search tool

Cons
13.83% APR for undergraduate loans
Funds release can take up to 10 days
5% late fee payment charge (up to $25)
Fixed APR Range: 3.50%–13.83%
Variable APR Range: 1.37%–11.76%
Loan Amounts: $1,000 minimum, no maximum
Grace Period: six months
Co-signer: Allowed but not required
on Sallie Mae Website

SoFi Review

SoFi
Fund your undergraduate, graduate, law or MBA degree.
- 3.22%–11.16%Fixed APR
- 1.10%–11.68%Variable APR
- $5,000 minimum, no maximumLoan Amount
- OptionalCo-signer
SoFi, founded in 2011, started offering student loan refinancing in 2012. It was the first company to offer the refinancing of both federal and private student loans. Since then, it has funded over $50 billion in loans.
SoFi offers several different financial products, including student loans. Depending on your needs, you can choose an undergraduate, graduate, law or MBA loan. SoFi also offers student loan refinancing. Parents and sponsors can also take out a loan to finance their student’s education.
If you choose to make automated payments, you can get a 0.25% discount on your interest rate. If you or your co-signer is already a SoFi member, you can also enjoy a 0.13% interest rate reduction. Additionally, you can earn and redeem rewards points by using the SoFi app. Student loans in good standing that are at least nine months old may also apply for unemployment protection assistance, which may lower monthly payments in the event of unemployment.
SoFi is a great option for individuals looking to finance the total cost of attendance in school. That said, there is a minimum loan amount of $5,000. If you need a lower amount, you may want to explore other options.
Pros
Borrow up to the total cost of your education
No origination fees
No prepayment penalties
No late payment or insufficient funds fees
Several discounts and rewards offered

Cons
$5,000 minimum loan amount
Four to six weeks funds processing
11.68% maximum variable APR
Fixed APR Range: 3.22%–11.16%
Variable APR Range: 1.10%–11.68%
Loan Amounts: $5,000 minimum, no maximum
Grace Period: Deferment until six months after graduation
Co-signer: Optional
on SoFi Website

Current Rates for Federal Student Loans

Federal loans are the best option for the lowest interest rate student loans. Unlike traditional student loans, federal student loan interest rates are set by federal law instead of based on your financial history.

The U.S. Department of Education extended COVID-19 emergency relief for student loans through the end of 2022, suspending loan payments, implementing a 0% interest rate and stopping collections on defaulted loans. Below are the rates through July 1, 2023.

Fixed Rates for Federal Student Loans

Loan Type
Borrower Type
Fixed Interest Rate
Direct Subsidized &
Unsubsidized Loans
Undergraduate
4.99%
Direct Unsubsidized Loans
Graduate or professional
6.54%
Direct PLUS Loans
Parents, graduate or
professional students
7.54%

How to Find Low-Interest Student Loans

Finding a private student loan with the lowest interest rate is essential for any borrower. It reduces how much you have to pay overall in the long run.

Tips to help you find a private student loan:

Maintain a good credit history

If you need to opt for a private student loan lender, your credit history determines your interest rates. Make sure to maintain a good credit history by making on-time payments on your bills or any other debt you might have.

Aim for a lower DTI ratio

Your debt-to-income (DTI) ratio is a key factor determining your APR. The lower it is, the better, as lenders have different thresholds or maximums.

Consider getting a co-signer

If you aren’t sure about your credit history or want a lower APR, getting a co-signer may help. Ask a family member or loved one with good credit if they would be willing to co-sign your loan. You may also want to opt for a lender who releases co-signers after a certain time.

Find a flexible repayment plan

It may be difficult to repay your loan right away — opt for lenders with a flexible repayment plan that can adjust depending on your situation in life.

Search for automatic payment discounts

The easiest way to reduce your interest rate is by opting for lenders who offer APR discounts. The most common one is for automatic payments, which a number of lenders we reviewed offer.

Compare fees and member benefits

When looking at private lenders, compare their offers and member benefits. Comparing lenders allows you to opt for the lowest rate available to you or perks that can help you with your studies and payments.

HOW WE REVIEWED PRIVATE STUDENT LOAN LENDERS

We reviewed more than 30 private student loan lenders using 35+ individual data points across six key categories: loan affordability, accessibility, consumer friendliness, customer service, flexibility and lender transparency.

Within each ranking criteria category, we considered several individual data points that carry the most weight when choosing a private student loan lender. These factors include APR ranges, available loan amount, minimum credit score, minimum income amount, application fees and disbursement time.

With the consumer in mind, we also factor in each lender’s customer support, business ratings and additional features that could make your experience easier and more accessible — like pre-qualification, payment options and mobile apps.

Frequently Asked Questions About Student Loan Rates

If you’re still unsure about low-interest student loans, MoneyGeek answered a few frequently asked questions.

sources

Federal Student Aid. "Interest Rates and Fees for Federal Student Loans." Accessed November 24, 2022.

*Rates, fees or bonuses may vary or include specific stipulations. The content on this page is accurate as of the posting/last updated date; however, some of the offers mentioned may have expired. We recommend visiting the card issuer’s website for the most up-to-date information available.
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