Episode Details

Starting July 1, federal student loan borrowers using auto pay will enjoy a one-percentage-point interest rate drop for two years — a major incentive designed to help pay down debt faster. If your rate is 6%, it’ll drop to 5%. This change is part of a broader overhaul including new grad student loan limits and a simplified repayment system. Borrowers on the SAVE plan may soon receive formal repayment notices. The Education Department is pushing hard to revive auto pay enrollment — which has plummeted from 83% in 2019 to just 40% — by offering this $6 billion incentive. To qualify, you must have loans taken out after July 1, 2012, and sign up for auto pay by September 30, 2026. Stay enrolled to keep the discount — a clear effort to reduce defaults and get more borrowers back on track.

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