03 Jul New Federal Student Loan Rates
According to UPI (United Press International), student loan debt will increase for many students as federal interest rates for new college loans will increase on July 1. The new rate for undergraduate student Stafford loans will be 4.45%, up from 3.86%. Graduate students will see an increase as well, going from 5.41% to 6%. Parents taking out loans to help pay for their child’s college education will also rise, jumping from 6.41% to 7%.
Under the previous rate, if paid off within 10 years, the amount of interest on the average student loan of $30,000 was $6,229. Under the new rate, the interest paid increases to $7,247.
Despite the increase in rates, experts such as Brianna McGurran at NerdWallet believe Federal student loans are still better than loans from private companies. Federal rates are fixed and will not increase year to year, she explains, “and they come with crucial protections like income-driven repayment and forgiveness for public-sector workers.”
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