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For the second year in a row, interest rates on federal student loans will decrease for the 2020-2021 academic year. This year’s decrease brings rates to record lows. The rates apply to new federal student loans made on or after July 1, 2020, through June 30, 2021. The interest rate is fixed for the life of the loan.

New rate 2020-2021 Old rate 2019-2020 Available to Borrowing limits
Direct Loans: Undergraduates

 

(Subsidized)

2.75% 4.53% Undergraduate students only

 

Subsidized loans are based on financial need as determined by the federal aid application (FAFSA)

For dependent undergraduates:

 

1st year: $5,500 (max $3,500 subsidized)

 

2nd year: $6,500 (max $4,500 subsidized)

 

3rd, 4th, 5th year: $7,500 (max $5,500 subsidized)

 

Max: $31,000 (max $23,000 subsidized)

Direct Loans: Undergraduates

 

(Unsubsidized)

2.75% 4.53% Undergraduate students only; all students are eligible regardless of financial need For dependent undergraduates:

 

1st year: $5,500 (max $3,500 subsidized)

 

2nd year: $6,500 (max $4,500 subsidized)

 

3rd, 4th, 5th year: $7,500 (max $5,500 subsidized)

 

Max: $31,000 (max $23,000 subsidized)

Direct Loans: Graduate or Professional Students 4.30% 6.08% Graduate or professional students only; all students are eligible regardless of financial need

 

Unsubsidized loans only

$20,500 per year; max $138,500
Direct PLUS Loans:

 

Parents and Graduate Students

5.30% 7.08% Parents of dependent undergraduate students and graduate or professional students

 

Unsubsidized loans only

Total cost of education, minus any other aid received by student or parent

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