Auto-pay perk expands: 1% interest cut for qualifying Direct Loans

The Education Department is offering a 1 percentage-point interest-rate discount for federal Direct Loans when borrowers enroll in autopay, a benefit that lasts through June 30, 2028. Eligible loans include Direct Subsidized, Direct Unsubsidized, Direct PLUS, and Direct Consolidation (including Parent PLUS if the loan is Direct); FFEL and private loans are not eligible. Loans must be disbursed on or after July 1, 2012 and be in good standing. Borrowers already in autopay receive the discount automatically; new enrollees must sign up by Sept. 30, 2026 and remain enrolled to keep it. As always, verify payments with your loan servicer to avoid autopay errors.