Finance
10-year private student loan interest rates surge
Our goal here at Credible Operations, Inc., NMLS Number 1681276, referred to as “Credible” below, is to give you the tools and confidence you need to improve your finances. Although we do promote products from our partner lenders who compensate us for our services, all opinions are our own.
The latest private student loan interest rates from the Credible marketplace, updated weekly. (iStock)
During the week of Apr. 8, 2024, average private student loan rates fell for borrowers with credit scores of 720 or higher who used the Credible marketplace to take out 10-year fixed-rate loans and increased for 5-year variable-rate loans.
- 10-year fixed rate: 9.40%, up from 7.37% the week before, +2.03
- 5-year variable rate: 7.39%, up from 7.10% the week before, +0.29
Through Credible, you can compare private student loan rates from multiple lenders.
For 10-year fixed private student loans, interest rates rose by over two percentage points, while 5-year variable student loan interest ticked up by more than a quarter of a percentage point.
Borrowers with good credit may find a lower rate with a private student loan than with some federal loans. For the 2023-24 academic school year, federal student loan rates will range from 5.50% to 8.05%. Private student loan rates for borrowers with good to excellent credit can be lower right now.
Because federal loans come with certain benefits, like access to income-driven repayment plans, you should always exhaust federal student loan options first before turning to private student loans to cover any funding gaps. Private lenders such as banks, credit unions, and online lenders provide private student loans. You can use private loans to pay for education costs and living expenses, which might not be covered by your federal education loans.
Interest rates and terms on private student loans can vary depending on your financial situation, credit history, and the lender you choose.
Take a look at Credible partner lenders’ rates for borrowers who used the Credible marketplace to select a lender during the week of April 8:
Private student loan rates (graduate and undergraduate)
Who sets federal and private interest rates?
Congress sets federal student loan interest rates each year. These fixed interest rates depend on the type of federal loan you take out, your dependency status and your year in school.
Private student loan interest rates 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 rates from multiple student loan lenders using Credible.
How does student loan interest work?
An interest rate is a percentage of the loan periodically tacked onto your balance — essentially the cost of borrowing money. Interest is one way lenders can make money from loans. Your monthly payment often pays interest first, with the rest going to the amount you initially 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- vs. variable-rate loan?
Here’s the difference between a fixed and variable rate:
- With a fixed rate, your monthly payment amount will stay the same over the course of your loan term.
- With a variable rate, your payments might rise or fall based on changing interest rates.
Comparison shopping for 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’ll owe over the life of your federal or private student loans.
Once you enter your information, you’ll be able to see what your estimated monthly payment will be, the total you’ll pay in interest over the life of the loan and the total amount you’ll pay back.
About Credible
Credible is a multi-lender marketplace that empowers consumers to discover financial products that are the best fit for their unique circumstances. Credible’s integrations with leading lenders and credit bureaus allow consumers to quickly compare accurate, personalized loan options – without putting their personal information at risk or affecting their credit score. The Credible marketplace provides an unrivaled customer experience, as reflected by over 4,300 positive Trustpilot reviews and a TrustScore of 4.7/5.
The money manager behind two of the world’s biggest actively managed exchange-traded funds sees a way for investors to stay defensive without leaving the market.
Jon Maier’s firm is behind the JPMorgan Equity Premium Income ETF (JEPI) and JPMorgan Ultra-Short Income ETF (JPST). They’re listed as No. 1 and No. 3 in size globally in their category, according to VettaFi.
The goal: give investors downside protection while generating income.
“When the VIX [volatility] increases, that offers the opportunity for an increased amount of income to the investor of JEPI,” the J.P. Morgan Asset Management chief ETF strategist told CNBC’s “ETF Edge” this week. “Conversely … when the volatility declines, given that the options are written out of the money, it provides some upside in the underlying portfolio.”
JEPI fell around 3% in April while volatility gripped the market. As of Thursday’s market close, the ETF is off about 4% for the year while the S&P 500 is down almost 5%.
JEPI’s top holdings include Mastercard, Visa and Progressive according to JPMorgan’s website as of April 30.
Meanwhile, the JPMorgan Ultra-Short Income Fund focuses on fixed income instead of U.S. equity. The fund is virtually flat so far this year.
“It provides a ballast in your portfolio [and] stability for those investors that are looking to protect principle,” Maier said.
‘Hiding out to weather the storm’
ETF Action’s Mike Akins notes these ETFs are satisfying an important investment need in the market.
“This category is where people are hiding out to weather the storm,” the firm’s founding partner said on the show.
According to J.P. Morgan Asset Management, the JPMorgan Ultra-Short Income Fund had the second-highest volume among active U.S. fixed income ETFs between April 3 and 10 — which marked the year’s most volatile weekly span on Wall Street.
Correction: Jon Maier’s firm is behind the JPMorgan Equity Premium Income ETF and JPMorgan Ultra-Short Income ETF. An earlier version misstated his status.
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Global investors are undergoing a structural rethink of their exposure to U.S. markets, according to economic expert Rebecca Patterson.
Patterson, who served as Bridgewater’s chief investment strategist, contends they’re gradually reducing exposure to U.S. assets and the impact could be significant. Her prediction comes after having conversations with participants in last week’s World Bank and International Monetary Fund meetings in Washington.
“There are a large number of foreign investors who are worried not only about tariffs, but just about America’s reliability as a partner,” Patterson said Monday on CNBC’s “Fast Money.”
Outside of the Trump administration’s tariff policy, she finds foreign investors and policymakers are losing faith in the U.S. on broader fears about the potential weaponizing of capital markets to achieve its economic goals.
That may put global investors’ U.S. holdings at risk, according to Patterson. Foreigners held more than $31 trillion of U.S. assets as of last June, according to the most recent U.S. Treasury data. That’s an increase of $4.4 trillion from the prior year. The gains came as U.S. markets reached all-time highs, thanks in part to megacap tech and the artificial intelligence trade.
“They are looking at a huge U.S. allocation that has built up over the last several years and saying, ‘maybe we should have a little bit less, just trim off the tops’ — basically, have a risk premium on U.S. assets because we have so much uncertainty,” she said.
Even a small reduction in global participation could present a problem for U.S. markets, Patterson warns.
“Pretend you’re the chief investment officer of a major overseas pension fund or sovereign wealth fund. I’m going to take 2% off my U.S. stocks, 2% off my U.S. bonds, a 4% shift,” she said. “That’s $1.2 trillion that is going to be leaving the U.S. now.”
A potential $1.2 trillion sell-off represents 2.3% of the S&P 500‘s total market capitalization, as of Thursday’s close. Still, Patterson emphasizes the capital flight will not happen overnight.
“These investment committees will take months to think about things. They’ll have a meeting, they’ll have a board approve it and then it gets implemented. But what this is, is a slow bleed of support out of the U.S. markets, either going back to home markets or into new opportunities, or things like gold,” said Patterson.
U.S. stocks have broadly underperformed other global equities so far in 2025, with the S&P down 4.7% in that time. Europe’s broad-based STOXX 600 index has gained 3.9% this year, while the MSCI AC Asia Pacific Index has risen 2.8% over the same period, per FactSet.
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