The U.S. Department of Education announced two major moves aimed at federal student borrowers: a temporary, higher autopay interest-rate reduction for certain loans, and broader rate and cost adjustments linked to default pressures. Under the autopay change, borrowers who enroll in autopay starting July 1 will receive a full percentage point interest-rate reduction for the next two years, replacing the current 0.25-percentage-point benefit. The Department said the incentive will apply to borrowers who enroll by Sept. 30 and will expire June 30, 2028. It also emphasized the move’s goal to help borrowers pay down balances faster and strengthen the federal loan portfolio’s overall health. Separately, the department lowered federal student loan interest rates for two years in response to high default rates, reducing rates by up to one percentage point. Taken together, the changes underscore how repayment costs remain a policy lever while federal student finance faces continued compliance, affordability, and default-risk scrutiny.