The 2025–2026 school year brings some of the highest federal student loan interest rates in history, combined with new borrowing caps, confusing servicing updates, and record levels of delinquency. If you’re a current borrower or planning to start school soon, these changes could affect your financial future in a big way.
At LoanSense, we help borrowers cut through the confusion, lower payments, and stay on track toward forgiveness or homeownership. Here’s what you need to know.
Federal loan interest rates for the upcoming school year are jaw-dropping:
To put this into perspective: when I was in undergrad, rates were closer to 2%. Today’s rates mean faster daily interest accrual, making repayment more expensive and balances harder to manage.
📌 Tip: Want to see how much interest you’re accruing daily? Multiply your weighted average interest rate by your total balance, then divide by 365. Many of our borrowers are shocked to see they owe $10–$20 in interest every day — before making a single payment.
Starting with the 2026 academic year, new federal borrowing limits kick in:
This shift could shrink enrollment at schools without large endowments to cover gaps in funding. Before enrolling, check your school’s financial stability and endowment — the last thing you want is a school that can’t sustain operations through your graduation.
On September 5, 2025, the Department of Education’s Ombudsman Office announced plans to:
While this sounds promising, many borrowers already face miscommunication nightmares — like receiving four different due dates for the same loan. At LoanSense, we solve this by getting all communication in writing with servicers to hold them accountable.
As of June 2025, 6 million borrowers (35%) are delinquent, with nearly 4 million in late-stage delinquency heading toward default. Projections show that 10 million people could default by year’s end.
The drivers?
Result: Record numbers of borrowers are requesting forbearance, but that only delays — and worsens — the problem.
Here’s what we recommend instead of relying on forbearance:
Managing student loans isn’t just about paying bills — it’s about creating a plan that supports your life goals, whether that’s buying a home, starting a family, or reaching forgiveness.
👉 Get your free student loan plan today at app.myloansense.com.
💸 Use code LS20OFF for $20 off your personalized student loan consultation.
Don’t let high interest rates and poor servicer communication derail your future. With the right plan, you can stay in positive standing and achieve your goals.