Home Business Federal student loan interest rate increases from July 1

Federal student loan interest rate increases from July 1

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RICHMOND, Virginia (WWBT) – Federal student loan rate will rise to 3.73% in the 2021/22 school year. This is after an all-time low of 2.75% over the past year.

Now, although interest rates on student loans are increasing, rates are low compared to the past decade. The rate change will not affect you if you have already blocked the loan.

In addition, under the first COVID-19 relief bill, federal student loan interest rates are 0% and may be deferred until October 2021.

However, if you are taking out student loans this year, our partners at the financial website Nerdwallet say that you should still use and exhaust federal loans before contacting private lenders.

Unlike private student loans, federal student loans do not require joint signatures and all borrowers receive the same interest rate.

One more tip! Experts say do not apply for loans until you complete the Free Application for Federal Student Aid (FAFSA) and receive a response from your college about scholarships, grants, and other non-refundable assistance. …

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