Key takeaways Interest rates on federal student loans are set on July 1 each year for loans disbursed from July 1 to June 30 of the following year. Borrowers with existing federal student loans will not see any changes when the Fed lowers interest rates. Private student loan rates — especially variable ones — are more directly influenced by Fed rate decisions. The Federal Reserve lowered rates for the third time in a row during the December 2025 meeting, but kept rates unchanged at the first two me ...