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Last week, the average interest rate on 10-year fixed-rate private student loans moved up.
Current Interest Rates for Private Student Loans
The average fixed interest rate on a 10-year private student loan was 7.92% from July 13 to July 18. That's for borrowers with a credit score of 720 or higher who prequalified on Credible.com's student loan marketplace. The average interest rate on a five-year variable-rate loan was 7.00% among the same population, according to Credible.com.
These rates are accurate as of the week of July 13, 2026.
Related: Best Private Student Loans
Fixed-Rate Loans
Last week, the average fixed rate on a 10-year loan increased by 0.47 percentage point to 7.92%. The average stood at 7.45% the week prior.
Borrowers currently in the market for a private student loan will receive a lower rate than they would have at this time last year. At this time last year, the average fixed rate on a 10-year loan was 8.58%, 0.66 percentage point higher than today's rate.
A borrower who finances $20,000 in private student loans at today's average fixed rate would pay around $242 per month and approximately $9,017 in total interest over 10 years, according to Forbes Advisor's student loan calculator.
Variable-Rate Loans
Last week, the average rate on a variable five-year student loan fell to 7.00% on average from 7.21%.
In contrast to fixed rates, variable interest rates fluctuate over the course of a loan term. Variable rates may start lower than fixed rates, especially during periods when rates are low overall, but they can rise over time.
Private lenders often offer borrowers the option to choose between fixed and variable interest rates. Fixed rates may be the safer bet for the average student, but if your income is stable and you plan to pay off your loan quickly, it could be beneficial to choose a variable loan.
Let's say you financed a $20,000 five-year loan with a variable interest rate of 7.00%. You'd pay about $396 on average per month. You'd pay approximately $3,761 in total interest over the life of the loan. Keep in mind that since the interest is variable, it could fluctuate up or down from month to month.
Applying for a Private Student Loan
Before you look to a private student loan, consider a federal student loan as your first option. The interest rates on federal student loans are generally lower. Federal student loans also tend to have far more generous repayment and forgiveness options. Yet, if you've reached the borrowing limits for federal student loans or if you're ineligible for them, private student loans can be a good solution.
Getting a private student loan generally involves applying directly through a non-federal lender, such as a bank, credit union or online entity. You may also be able to get a private student loan through a nonprofit organization, state agency or college.
It's important to note that you'll need a qualified co-signer if you have limited credit history, as undergraduates often do.
Here's what to consider when applying for a private student loan:
- Make sure you qualify. Private student loans are credit-based, and lenders typically require a credit score in the high 600s. This is why having a co-signer can be particularly beneficial.
- Apply directly through lenders. You can apply directly on the lender's website, via mail or over the phone.
- Compare your options. Look at what each lender offers and compare the interest rate, term, future monthly payment, origination fee and late fee. Also, check to see if the lender offers a co-signer release so that the co-borrower can eventually come off of the loan.
How To Compare Private Student Loans
The first step in finding the best private student loan is to take a look at the loan's overall cost. Consider both interest rate and fees. Also, look at the type of help each lender offers if you're not able to afford your payments.
Remember, those with good or excellent credit typically get the best rates.
How much should you borrow? Experts generally recommend borrowing no more than you'll earn in your first year out of college. How much can you borrow? Some lenders cap the amount you can borrow each year, while others don't. When you're shopping around for a loan, talk to lenders about how the loan is disbursed and what costs it will cover.
Current Federal Student Loan Interest Rates
If you need to borrow for school, federal student loans are generally the best option. This is because federal loans offer various borrower protections, such as access to income-driven repayment plans and student loan forgiveness programs. Additionally, most federal loans don't require a credit check or co-signer.
How Lenders Determine Your Rate
The rate you receive depends on whether you're getting a fixed or variable loan. Rates, in part, are based on your credit profile. Those with higher credit scores often get the lowest rates. But your rate is based on other factors as well. Income and even the degree you're working on and your career can play a part.
What Are the Benefits of Private Student Loans?
It's generally a good idea to max out your eligibility for federal financial aid before borrowing private student loans, but private loans have some benefits. For one thing, they don't have the same annual borrowing limits as federal loans. Many lenders let you borrow up to your cost of attendance minus any other financial aid you've already received.
Plus, you can usually apply throughout the year with a fast, easy online application. For instance, you can apply for a private loan if you need funds halfway through the semester. Some lenders can fund your loan in a week or two, though others take longer.
Private lenders can also offer competitive interest rates, especially to borrowers with excellent credit. Some private loans don't have any fees, so you don't have to worry about origination fees, administrative fees or even late fees in some cases.
You also may not have to make payments on your private student loan while you're in school or for six to nine months after you graduate, depending on the lender. Some lenders offer additional perks to borrowers, such as forbearance and deferment, the option to skip a payment or career counseling services.
Some private lenders offer loans to international students. International students are not eligible for federal student loans from the U.S. Department of Education, so a private student loan can provide the funds they need for college or graduate school in the U.S.
