8 Best Student Loans with the Lowest Interest Rates in 2023
If you are looking for student loans lowest interest rates, we have compared 5 top lenders for you. Read to find out how to apply

College can be costly and loans are often the best way for you to cope financially whilst you study. We recommend that you look at student loans with lowest interest rates so that you can pursue your educational opportunities with ease.
Start by exploring federal student loans, but we’re fully aware that federal loans alone may not be enough to cover the cost of your education. Many choose to take out private student loans and so we’ve reviewed the most trusted private student lenders to identify those that are offering the lowest interest rates.
Types of Low Interest Loans
There are two main types of low-rate loans including federal loan options and private student loans.
Federal Student Loans
Federal student loans are provided by the U.S. Department of Education and they have the lowest interest rates along with flexible repayment options. To qualify for these loans a student must complete the free application for federal student aid also known as FAFSA.
There are four types of federal loans:
Direct Subsidized Loans
To be eligible for a direct subsidized loan, you must be enrolled in college at least half of the time. These loans are provided to the student after assessment of their financial need and the interest rate is subsidized to make the repayment easier. The interest is only charged after graduation and the student gets an additional 6 months grace period as well. In case of deferment, you will not be charged interest for that time.
Direct Unsubsidized Loans
These loans do not need to assess the financial needs of the student and therefore have a fixed interest rate that starts as soon as the funds are allocated and continue till the loan is paid in full. Unsubsidized loans however still have flexibility in repayment.
Direct PLUS Loans
Direct Plus loans are provided to the parents and caregivers of students. These also have fixed interest rates with flexible repayment options. The parents do not have to pass a credit check and can defer the loan till the student graduates. Direct Plus loans are also available for graduate and professional students.
Direct Consolidation Loans
For multiple federal student loans, the government can offer a single loan with fixed interest rates to pay off the other loans. This helps in getting debt sorted and provides the students a better debt ratio.
Private Student Loans
Private student loans are provided by banks and other lending institutions. The borrower of private loans must pass a credit check and prove their creditworthiness. These loans usually have a higher interest rate but you can borrow a bigger loan amount.
That said, if you have exhausted all the federal loan options given above, you can still find student loans with low interest rates. Continue reading to understand the criteria you must meet to get the lowest interest rates from lending institutions.
Private Student Loans with Lowest Interest Rates
Lender | Scholaroo | Our view | Fixed rates | Variable rates | Learn more |
---|---|---|---|---|---|
![]() Sallie Mae | A trusted lender with great offers | 4.50% | 4.62% | Visit website | |
![]() College Ave | The best for low interest student loans | 3.99% | 3.99% | Visit website | |
![]() Earnest | The best for low interest student loans | 3.99% | 3.99% | Visit website | |
![]() Ascent | Great for loans without cosigners. | 4.62% | 4.72% | Visit website | |
![]() Sofi | Great lender for private student loans. | 4.99% | 4.49% | Visit website | |
![]() Discover | Best lender with zero fees and valuable rewards | 5.49% | 5.87% | Visit website | |
![]() Citizens Bank | Great for multi-year approval | 4.99% | 5.10% | Visit website | |
![]() PNC Bank | Best for auto-pay interest rate discounts | 4.49% | 5.64% | Visit website |
The following are details on the best private student loan options with the lowest interest rates. However, most lenders do require the borrower to be creditworthy for offering them the lowest interest rate.
#1 Sallie Mae
Sallie Mae is one of the most popular lending institutions and is considered to be the largest loan provider in the country. For students, Sallie Mae offers multiple different types of loans including undergraduate, graduate, career training, medical school loans, and many more, as well as also offering credit cards and saving accounts.
Loans by Sallie Mae can be easily applied for through a cosigner and provide discounts for fixed payment schedules.
Pros of Sallie Mae:
No origination fees
100% school attendance costs covered
Discounts for fixed payment schedules
Easy repayment options
Needs a cosigner
Cons of Sallie Mae:
They will conduct a credit check
Eligibility Requirements:
Verified school admission halftime or more
Must be a U.S. citizen or permanent resident
Should have a minimum credit score (undisclosed)
Repayment Details:
Fixed and variable repayment options available
Cosigner can be released after 12 regular payments
Deferment options available for undergraduate and graduate borrowers
Repayment terms 5-15 years
#2 College Ave
College Ave provides many loan options that are flexible and has the lowest APR rates. Students can choose from various repayment options, along with coverage of 90% of their school costs. You also have the flexibility to choose additional loans with a cosigner, giving you a multi-year peace of mind.
You can easily calculate the terms and your payments on their website, making it easier for you to see everything in one go.
Pros of College Ave:
- Lowest APR rates
- Multi-year additional loans are available
- Coverage for up to 100% cost of attendance
- Flexible repayment terms
- No origination fees
Cons of College Ave:
- Cosigner release is not possible until half of the loan payments are complete
Eligibility requirements:
- Need a cosigner
- Must be a U.S. citizen or permanent resident
- School verification
Repayment terms:
- You can start repaying your principal interest from the beginning
- Loan term can be 5-15 years
- Deferment options available
- Cosigner release only possible after half of loan payments are done
#3 Earnest
Students can get good loan options with flexible terms of repayment through Earnest without worrying about additional fees. Earnest does not charge any fee for the origination, application, or early closure of the loans. It provides good APR rates and a choice of variable or fixed interest rates.
You can check their website and find out eligibility in a few minutes.
Pros of Earnest loans:
- No fees at any point of the loan
- 9 months grace period
- Discount on fixed payments
- Flexible loan repayment terms
Cons of Earnest loans:
- Cosigner has to complete the loan term
Eligibility requirements:
- Should have a minimum credit score of 650
- Must be a U.S. citizen or permanent resident
- All States except Washington DC and Nevada
Repayment terms:
- 9 months grace period
- Start paying principal interest from start
- Loan term 5-15 years
- No cosigner release
#4 Ascent
Ascent is a popular choice for students as its options include a non-cosigned loan and a loan based on future income.
Ascent also offers deferment options and flexible repayment plans. It provides a 9-month grace period after graduation making it easier for the students to start repaying their loans.
Pros of Ascent:
- Apply for loans without a cosigner
- 9 months grace period
- Flexible repayment options
- Deferment options available
Cons of Ascent:
- Loan amounts have limitations
Eligibility requirements:
- Minimum credit score 540
- School verification
- Must be a U.S citizen or permanent resident
Repayment terms:
- Cosigner release after 24 regular payments
- 9 months grace period
- Loan terms 5-15 years
#5 SoFi
SoFi is a leading provider of student loans that covers federal and private loans. SoFi also provides various other banking services including credit card, mortgage and auto financing.
SoFi members can gain access to exclusive deals and discounts, financial advice, flexible repayment plans and more.
Pros of SoFi loans:
- Many member benefits
- Financial planning & advice
- Special discounts for a cosigner that is also SoFi member
- Flexible plans
Cons of SoFi loans:
- Minimum loan amount required
Eligibility requirements:
- Must be enrolled in a degree-awarding eligible school
- No minimum income requirement
- All 50 states covered
Repayment terms:
- Cosigner release after 24 regular payments
- 6-month grace period
- Fixed monthly payments of $25
#6 Discover
Discover offers multiple private student loan options available to undergraduates, graduates, health professionals, MBA students, Law students, bar exam, and to students in residency. They also have options for parents and other creditworthy individuals. They do not charge late fees on their private student loans and provide further interest rate discounts based on certain conditions. For example, those registered for auto pay can receive a 0.25% rate reduction.
Pros of Discover Loans:
- No origin fee, late fee, or application fee
- Cash rewards for good grades
- Covers up to 100% of school-certified college costs
- 0.25% rate reduction with auto pay
- Various economic hardships and repayment options
- International students can qualify with a co-signer who is a U.S. citizen or a permanent resident
- Multi-year option available
Cons of Discover Loans:
- No cosigner release program
Eligibility Requirements:
- Must be a U.S. citizen or permanent resident, or have a cosigner that is one
- Seeking an undergraduate or graduate degree
- Enrolled at least half-time in a degree program at an eligible school
- Must be making satisfactory academic progress
- Be 16 years or older when applying
- Pass a credit check (minimum limit undisclosed)
Repayment Details:
- Fixed and variable repayment options available
- Deferment options available
- Repayment term 15 years
- Interest-only payments during school and grace period
#7 Citizens Bank
Citizens Bank provides private student loans to undergraduates pursuing bachelor’s degrees, graduate students, and parents. They offer good rates to creditworthy individuals along with a further discount of 0.25% if the borrower or cosigner has an existing account with the bank. Citizens Bank has a multi-year approval system too where borrowers do not require a hard credit check for future loans.
Pros of Citizens Bank Loans:
- Multi-year approval
- International students can qualify with a cosigner who is a U.S. citizen or permanent resident
- 0.25% loyalty discount
Cons of Citizens Bank Loans:
- Maximum limit of $150,000 for undergraduate loans
- No firm deferment or forbearance policies
- Charges late fee and returned payment fee
- Minimum credit required
- No soft credit checks available
Eligibility Requirements:
- Must be a U.S. citizen or permanent resident or have a cosigner that is one
- Borrowers must be enrolled at least half time
- No prior student loan defaults
- Must be the age of majority otherwise needs a cosigner that is
- Must be credit-worthy (minimum score undefined)
Repayment Details:
- Fixed and variable repayment options available
- Repayment terms 5, 10, 15 years
#8 PNC Bank
PNC Bank offers multiple private student loan options with low-interest rates for undergraduates, graduates, and professionals. They offer a further discount of 0.50% on the rates if you enroll in automatic payments. PNC gives their borrowers various refinancing and forbearance options too. The loan modification with PNC can also help you to lower the rates and monthly payments charged on your loan.
Pros of PNC Bank Loans:
- No origin or application fee
- 0.50% discount with auto pay
- Customizable payment plans
- Cosigner release
- Scholarships available
Cons of PNC Bank Loans:
- Requires credit approval
- Requires a hard credit check
- Cosigner release available after 48 months of consecutive timely payments
- International students cannot apply
Eligibility Requirements:
- Both student and cosigner (if any) must be a U.S. citizen or permanent resident
- Enrolled at least half-time in a degree or certificate program
- Satisfactory credit history
Repayment Details:
- Fixed and variable repayment options available
- Refinancing and forbearance available
- Customizable payment plans
- Loan terms 5, 10, 15 years
- Interest-only payments while in school
- Deferred payments start after 6 months of graduation
How to Get A Low Interest Student Loan?
There various are factors that can contribute to getting a lower interest rate on a student loan. Consider taking the following steps:
Tip 1: Build Good Credit
Lending institutions provide better interest rates and repayment options to borrowers with good credit. You can start building your credit with easy steps like a prepaid credit card and paying your existing loan payments on time. When you have a good credit score lenders provide loan options with lowest interest rates.
Tip 2: Have a Low Debt-to-Income Ratio
Reducing your overall debit load really helps in getting good loan options. Lenders always evaluate your credit, and your overall debt burden, and compare it to your income. If your debit burden is low, that means you are able to maintain regular loan payments without being a high risk. Consider paying off your debt load at least 2-3 months prior to applying for a new loan. This helps in improving your credit score and debt-to-income ratio.
Tip 3: A Cosigner or a Guarantor
A cosigner or a guarantor can bring their good credit score to your loan application. Commonly student loans are cosigned by the parents and they bear the full responsibility of paying off the loan. This can help in getting lower interest rates from lenders. Loans can also be cosigned by other relatives and grandparents.
Tip 4: Consider a Shorter Repayment Structure
A short term loan is less riskier and gets lower interest rates compared to a long term loan. If you are able to pay off larger monthly payments, a short term loan will not only get you better rates but you will also benefit from paying interest for a shorter time period.
Tip 5: Do Detailed Lender Comparisons
Before signing up with a lender, you should review different institutions and do detailed comparisons. Some lenders may offer you special student discounts which will help in getting a better loan deal. Study the lenders and their reviews before making a final decision.
FAQs
Which type of student loan has the lowest interest rates?
The subsidized federal student loans provide fixed interest rates that are lower than other lending institutions. To receive better interest rates on private student loans, we recommend building good credit and having a cosigner.
Do I need a cosigner for student loans?
Some banks and lending institutions require a cosigner for student loans. Sallie Mae is one of the top leading loan providers in the country and requires a cosigner that can be released after 12 regular payments. Cosigners can be parents, grandparents or other relatives. However, not all lenders require a cosigner. Ascent is among the lenders offering student loans without a cosigner.
Which bank gives the lowest interest rates on student loans?
Based on our research, College Ave offers the lowest interest rates and better repayment options than other banks and lending institutions. You can review our comparison table and detailed review of lenders to understand which options work best for you.