The U.S. Department of Education is cutting federal student loan borrowing costs for a limited period and expanding the payoff for borrowers who enroll in autopay. Starting July 1, borrowers who sign up for autopay will receive a full 1-percentage-point interest rate reduction (up from 0.25 percentage point), and the benefit is set to run until June 30, 2028. The incentive applies to eligible loans first disbursed on or after July 1, 2012. Separately, the department is reducing interest rates on federal student loans by up to one percentage point for two years, citing high default rates. Both actions land as borrowers face higher college prices and inflation across the broader economy. For institutions, these changes may affect student aid planning, counseling workflows, and how campuses communicate repayment benefits during the next academic cycle—particularly for students nearing repayment milestones and those using federal consolidation strategies.