Trump Cuts Student Loan Rates 1 Point for Autopay Signups

The Trump administration will cut federal student loan interest rates by a full percentage point for borrowers who enroll in autopay, starting July 1. The current autopay discount is 0.25 percentage points.

Borrowers not already on autopay have until Sept. 30 to sign up and lock in the lower rate, which runs through June 30, 2028.

"The Trump Administration is making student loan repayment easier than ever, and borrowers should not wait to take advantage of this temporary interest rate reduction to stay on track for key student loan benefits," Under Secretary of Education Nicholas Kent said in a statement.

The move lands as tens of millions of borrowers face a sweeping overhaul of the federal student loan system this summer, driven by changes in Trump's "one big beautiful bill." The law tightens access to affordable repayment plans and other relief measures.

More than 42 million Americans hold federal student loans, with total outstanding debt above $1.6 trillion, per the Congressional Research Service.

Autopay enrollment among borrowers in active repayment stands at 40%, down from over 80% before the Covid pandemic, according to the U.S. Department of Education.