Department of Education Bumps Autopay Interest Discount to 1% — Here’s Who Wins

The U.S. Department of Education announced that its quadrupling the interest rate discount for federal student loan borrowers who enroll in autopay, raising it from 0.25% to a full 1 percentage point starting July 1, 2026.

Borrowers who sign up for automatic payments (or who are already enrolled) will get a 1% reduction on their federal student loan interest rate. The discount is temporary: borrowers who enroll by September 30, 2026 (or are already enrolled) keep the benefit through June 30, 2028.

Already on autopay? You don't need to do anything. Loan servicers will automatically apply the extra 0.75% on top of the existing 0.25% discount.