Deadline extended to enroll in auto pay for student loan interest rate cut

Student loan borrowers now have an additional three months to enroll in auto pay to receive a 1% interest rate cut through June 30, 2028.

Beginning July 1, the interest rate reduction for borrowers who use auto pay grew from 0.25% to 1%. To lock in this discount, borrowers must enroll in auto pay by 11:59 p.m. EST Dec. 31. The deadline previously was Sept. 30, but the U.S. Department of Education announced the extension Sept. 29.

The reduction is available for borrowers with Direct Loans disbursed on or after July 1, 2012. Those already enrolled in auto pay do not need to take any action.

Borrowers will get the discount as long as they remain in auto pay and continue to repay their student loans. The reduction will stop if they cancel auto pay or move to forbearance or deferment.

To learn more, visit studentaid.gov.