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Average private student loan rates for borrowers with a credit score of 720 or higher who have used the Credible Market to take out student loans have increased for both fixed and variable rates during the week of November 22, 2021.
- 10-year fixed rate: 6.41%, against 6.40% the previous week, +0.01
- 5-year variable rate: 5.91%, against 3.53% the previous week, +2.38
With Credible, you can compare private student loan rates from lenders without affecting your credit score.
While variable rates on 5-year private student loans increased by more than 2 percentage points last week, 10-year fixed rates barely increased. Rates for this term remain lower than they were at the start of the month – in the week of November 1, 2021, 10-year fixed rates hit 6.54%. Overall, rates have been very unpredictable from week to week, so there is a possibility that they will drop again by next week. Students looking for interest savings may want to go for a 10-year term now.
You should always exhaust federal student loan options before turning to private student loans to cover any funding shortfalls. Private lenders such as banks, credit unions, and online lenders offer private student loans. You can use private loans to pay for education and living expenses, which might not be covered by your federal student loans.
The interest rates and terms for private student loans can vary depending on your financial situation, credit history, and the lender you choose.
Take a look at Credible Partner Lender Rates for borrowers who used the Credible Marketplace to select a lender during the week of November 22.
Private student loan rate (diploma and undergraduate)
Trends in weekly student loan rates
Who sets federal and private interest rates?
Congress sets the interest rates on federal student loans annually. These fixed interest rates depend on the type of federal loan you take out, your dependency status, and your school year.
The interest rates for private student loans can be fixed or variable and depend on your credit, repayment term, and other factors. As a general rule, the better your credit score, the lower your interest rate is likely to be.
You can compare the rates of several student lenders using Credible.
How Does Student Loan Interest Work?
An interest rate is a percentage of the loan added to your balance periodically – essentially the cost of borrowing money. Interest is one way lenders make money from loans. Your monthly payment often pays interest first, with the rest going to the amount you originally borrowed (the principal).
Getting a low interest rate could help you save money over the life of the loan and pay off your debt faster.
What is a fixed rate or variable rate loan?
Here is the difference between a fixed rate and a variable rate:
- With a fixed rate, the amount of your monthly payment will remain the same for the duration of your loan.
- With a variable rate, your payments can go up or down based on changes in interest rates.
Comparing private student loan rates is easy when you use Credible.
Calculate your savings
Using a student loan interest calculator will help you estimate your monthly payments and the total amount you owe over the term of your federal or private student loans.
Once you enter your information, you will be able to see what your monthly payment estimate will be, the total you will pay in interest over the term of the loan, and the total amount you will repay.
Credible is a multi-lender marketplace that allows consumers to discover the financial products best suited to their unique circumstances. Credible’s integrations with major lenders and credit bureaus allow consumers to quickly compare accurate and personalized loan options – without putting their personal information at risk or affecting their credit score. The Credible Marketplace offers an unmatched customer experience as evidenced by over 4,300 positive Trustpilot reviews and a 4.7 / 5 Octoberscore.