Students who reached their federal borrowing limits were likely to pay lower rates in November when they turned to private student loans, a a new analysis shows.

Borrowers with excellent credit seeking take out private student loans through the Credible marketplace last month qualified for lower rates on fixed and variable rate loans than in October.

For borrowers with a credit score of 720 or higher selecting a lender in the Credible Market in November:

• 10-year fixed-rate student loan rates averaged 6.10%, up from 6.71% in October and 6.23% a year ago.
• The initial 5-year variable rate student loan rates averaged 3.37%, up from 4.70% in October and 5.79% a year ago.

Using an online tool like Credible allows you to compare interest rates on private student loans from multiple lenders in one place.

The chart above shows the average prequalified rates for borrowers with a credit score of 720 or higher who have used the Credible Marketplace to select a lender. The graph shows the average monthly rates for the past 3 years.

While federal student loans have fixed interest rates, private lenders typically offer the choice of a fixed or variable rate student loan. A variable rate loan often offers a lower interest rate upfront, but your rate can go up or down depending on economic factors.

Whether you subscribe to a fixed or variable rate private student loan, the interest rate you can claim will depend on factors such as your credit rating, the type of loan you are looking for (fixed or variable rate) and the length of the loan repayment period. Since many students do not have an income and credit history, most private student loans are co-signed.

The chart above shows that rates are often lower on co-signed loans and higher on loans with longer repayment terms.

Since lenders all have their own methods of assessing borrowers, it is a good idea to apply for private student loan rates from multiple lenders so you can compare your options.

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About Credible

Credible is a multi-lender market that allows consumers to discover the financial products best suited to their unique situation. Credible’s integrations with major lenders and credit bureaus allow consumers to quickly compare accurate and personalized loan options – without putting their personal information at risk or affecting their credit score. The Credible Marketplace offers an unparalleled customer experience as evidenced by more than 3,700 positive reviews on Trustpilot and a 4.7 / 5 Octoberscore.