The reduction is temporary through June 30, 2028 under the current guidance. Confirm eligibility with your official loan servicer; not every loan or account status necessarily qualifies.
What the announced benefit says
Federal Student Aid and servicer notices state that an eligible borrower who enrolls in auto-pay by December 31, 2026 may receive a 1% interest-rate reduction through June 30, 2028. Published guidance describes eligibility for Direct Loans first disbursed on or after July 1, 2012. The 1% is a temporary total rate reduction during the program window, not a permanent change to the note rate.
What to do
- Sign in to your official loan servicer account using the verified servicer website.
- Check whether your loan types, loan dates, and current status qualify.
- Read the actual auto-pay terms, draft date, bank-account authorization, and any cancellation rules.
- Enroll only if you understand the authorization and have enough funds to cover scheduled withdrawals.
- Save the confirmation, then check the loan rate or statement to verify the discount has been applied.
Watch-outs
- Auto-pay is not a substitute for reviewing your repayment plan or current payment amount.
- Confirm whether an existing enrollment counts automatically or requires any action.
- Do not share bank logins or account passwords with a third-party company.
- If payments are changing because of a new repayment plan, verify the withdrawal amount and effective date before the next debit.
Official links
Federal Student Aid: prepare for payments and auto-pay ↗
Aidvantage notices with current auto-pay guidance ↗
This is an educational summary, not an offer of a specific interest rate or a guarantee of eligibility. Your servicer can confirm the rate applicable to your loan.