Federal Student Loan Interest Rate for 2022-23

Federal Student Loan Interest ratesThe Federal Direct Student Loan interest rates for the school year 2022-23 have been determined by the government and they will be higher for the school year 2022-23.   This will be for new federal loans disbursed between July 1, 2022, and June 30, 2023. The net increase is 1.26  from last year’s rate.  Th 2021-22 rates were relatively low still due to COVID.

These are the rates for new federal student loans.  Under the National Forbearance program due to COVID current loans have a 0% interest rate until 8/31/2022.

Families and students who are considering using Federal Direct Loan for the 2022-23 school year will be charged the interest rates below.  Borrowers need to understand how these rates are calculated and the impact of long-term student debt. It’s important to keep in mind that while the rates change every year, these changes will only affect loans during the upcoming period.  These have no effect on previous loans or future borrowing. 

The federal student loan interest rates change each year on July 1st. The interest rate is based on the May 10 Year Treasury Note auction each year plus the Department of Education add-on fees.  This year’s May auction resulted in an interest rate of 2.84% versus a May 2021 rate of 1.68%

This student loan interest rate impacts direct subsidized, direct unsubsidized, direct graduate, and direct plus loans. The interest rates are fixed for the life of the loan based on the loan type borrowed. If the federal loans are consolidated, then the new federal consolidated loan will have a new interest rate.  It is a weighted average using the average of the loan balance and the associated interest rate for each loan. 

To learn more about all types of loans available, please read our comprehensive article on student loans.

In addition to the interest rate, there are processing fees associated with these loans, and these fees change depending on the type of loan the student or parent is using.

The chart below provides the new effective interest rates for Direct Federal Loans disbursed starting July 1, 2022, and before June 30, 2023.

Federal Student Loan Interest Rated 2022-23

Private Student Loan Alternative 

With interest rates at record lows, some families may benefit by using a private student loan.  The biggest advantage to using a private student loan is the fees are normally much lower.  Here is a list of PayForED’s current preferred private lenders.

Variable Rates: 3.99%- 14.86% (APR)*

Fixed Rates: 3.99% - 14.96% (APR)*

*Rates includes .25% Auto Pay Discount

Variable Rates*: 5.49% – 15.83%

Fixed Rates*: 4.50% - 14.83%

*Lowest rates shown included auto debit discount

Variable with ACH: 5.86%- 14.14%

Fixed with ACH: 4.62% - 14.99%

Variable Rates: 3.98% - 11.99% (APR)*

Fixed Rates: 3.98% - 11.99% (APR)*


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