Student Loan Auto Pay 1% Rate Cut Savings Calculator
The U.S. Department of Education is cutting the interest rate by 1 percentage point for federal student loan borrowers who enroll in auto pay by December 31, 2026, through June 30, 2028. See roughly how much interest that saves you. Runs in your browser; nothing is saved.
How to get the 1% reduction
- Log in to your student loan servicer account, choose "auto pay," enter your bank account and confirm your payment amount. It's free; you never need to pay a company to do this.
- Enroll by December 31, 2026. Borrowers who were already enrolled were moved to the 1% reduction automatically.
- Stay in auto pay and meet the eligibility rules to keep the lower rate through June 30, 2028.
- In default? Log in to StudentAid.gov, consolidate eligible loans and pick a new repayment plan first, then enroll in auto pay.
Before July 1, 2026, auto pay cut the rate by 0.25%. The Department calls the 1% reduction a temporary benefit. It also says auto pay helps you avoid missed payments, which matter for the Repayment Assistance Plan (RAP) and for PSLF.
Source: U.S. Department of Education press release, Sept. 29, 2026 ↗. Last checked Oct 28, 2026. This is an estimate: servicers charge simple daily interest, and this tool uses a monthly approximation over the reduction period only. Your servicer's numbers control. Related: RAP vs Tiered Standard calculator, leaving-SAVE plan chooser.
How much is the student loan auto pay interest rate reduction?
1 percentage point for borrowers who enroll in auto pay by December 31, 2026 (or were already enrolled), through June 30, 2028. Before July 1, 2026, the auto pay reduction was 0.25%.
Which loans qualify?
The Department of Education says the reduction benefits borrowers whose Federal Direct Loans originated after July 1, 2012, including student and parent borrowers. Defaulted loans qualify once they are back in good standing.
What if I'm already enrolled in auto pay?
The Department says borrowers already enrolled had their rate adjusted to the 1% reduction automatically. Stay enrolled to keep it.
How do I enroll?
Log in to your student loan servicer account, select auto pay, enter your bank account information and confirm your payment amount. It's free.