The U.S. Department of Education is rolling out lower federal student loan interest rates for borrowers who enroll in autopay starting July 1. Under the policy, borrowers will receive a full 1-percentage-point interest rate reduction for the next two years, replacing the previous 0.25-percentage-point benefit. The reduction will apply to borrowers who were already on autopay or who opt in before Sept. 30, and it will expire June 30, 2028. The department estimates the incentive will cost $6 billion. Separately, interest rates on new student loans will rise on July 1 for the next school year, as borrowers continue to face elevated education costs alongside broader inflation pressures. The combined effect highlights how federal pricing mechanisms can quickly alter student borrowing costs during peak enrollment and financial-aid decision windows.