Following the direction of Congress, the benchmark used to calculate the variable interest rate of some private student loans will soon change. Federal student loans will not be impacted by this change.
The new calculation for variable interest rates should not cost student loan borrowers any more or less than the previously calculated rate. In addition, the new rate index does not impact any other terms, conditions, or benefits associated with the student loan. Read the following fact sheet to learn more about the change from the London Inter-Bank Offered Rate (LIBOR) to the Secured Overnight Financing Rate (SOFR).