Interest Rates on Federal Student Loans to Be Highest in Decade

College will cost more for students borrowing during the 2023-24 academic year as federal student loan interest rates climb to heights not seen in a decade or longer.

As of July 1, undergraduates who take out new direct federal student loans will see interest rates rise to 5.50%, the Education Department’s Federal Student Aid office said Tuesday — up from 4.99% in the 2022-23 academic year and 3.73% in 2021-22.

Interest rates on graduate direct loans, available to graduate and professional students, will rise to 7.05% from 6.54% the year prior. PLUS loans, which parents and grad students can use to fill in education funding gaps, will jump to 8.05% from 7.54%. Here are the higher 2023-24 rates for each type of federal student loan, compared with the 2022-23 academic year:

Undergraduate direct loans: 5.50%, up from 4.99%.

Graduate direct loans: 7.05%, up from 6.54%.

PLUS loans: 8.05%, up from 7.54%.

Undergraduate direct student loan interest rates haven’t been this high since 2013….

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This article was written by Eliza Haverstock and originally published on