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The country's most renowned college brand announced its plans Monday to join the growing list of colleges that have suspended standardized testing requirements for the Class of 2025.

Harvard College is the latest college to announce it will not require applicants to submit SAT or ACT scores this fall. The surge in colleges announcing test-optional policies is one of many ways the college admissions and financial aid worlds will be turned upside down next year as colleges plan around the coronavirus.

Multiple surveys have found that families of college students are trying to sort out how to afford for college after job losses or pay cuts. One survey reports four out of 10 college students expect they’ll need to borrow more this fall to pay tuition bills.

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Even before the pandemic and recession, paying for college was no easy feat: Tuition at public four-year colleges now averages more than $10,000 a year for in-state students, and that doesn’t include housing, books, and other living expenses. Nearly two-thirds of bachelor’s degree recipients have to use loans to help cover the bill.

This year, some students will be forced to rely on student loans more heavily to afford to go to college. Others may opt to attend a less expensive school or sit out a year to try to avoid debt.

Money’s roundup of news and interest rates can guide you through your decision.

College News and Student Loan Updates For 2020

Harvard may be one of America’s oldest, most elite institutions of higher education, but in this announcement it was following the crowd. Every Ivy League college except for Princeton University has already said it will waive the traditional SAT and ACT requirements this year.

We understand that the COVID-19 pandemic has created insurmountable challenges in scheduling tests for all students, particularly those from modest economic backgrounds, and we believe this temporary change addresses these challenges,” Harvard said in a statement announcing its decision.

It’s not only private colleges that have waived their testing requirements. Large public universities including the University Virginia, Michigan State University, and Pennsylvania State University have all made similar test-optional decisions for the 2020-2021 admissions cycle. Last month, the regents at the University of California system voted unanimously to phase out use of SAT and ACT scores in their admissions process. In 2025, the system will start using a new exam developed by its faculty.

Make no mistake: it won’t necessarily be easier for students to get into hyper-competitive colleges simply because those colleges have dropped SAT/ACT requirements, and some colleges may still require the scores if applicants want to be considered for merit-based scholarships offered by the college. But it does take some pressure off high school seniors who may underperform on standardized tests.

The number of colleges with test-optional policies had already been growing every year, but that “wave became a tsunami” after the spread of coronavirus, Bob Schaeffer, interim executive director of FairTest, said in a press release. FairTest, which advocates for test-optional policies, reports that nearly 200 colleges and universities have gone test-optional so far this spring, bringing the total number of four-year colleges that don’t require ACT or SAT scores to more than 1,200.

Most colleges have reported they will suspend testing requirements for only one year, as testing companies make plans to conduct exams online this fall if high schools in parts of the country remain closed. Still, coronavirus has given fuel to the long-standing push to eliminate high-stakes testing from college admissions. Test-optional advocates say that standardized exams are not effective in measuring students’ abilities and readiness for college. Research also shows that scores are closely tied to family income and education, meaning that they may result in a greater disadvantage for students from low-income families or underrepresented minority groups.

Will colleges with temporary waivers decide later to eliminate the tests for good? We’ll have to wait and see.

Current Federal Student Loan Rates

If you need to borrow for college, federal student loans should be the first option you explore, as they are easy to access. They don’t require credit checks and nearly any student in good academic standing can get them. Federal loans also offer more flexible repayment options than private loans. Annual borrowing limits range between $5,500 to $12,500, depending on your school year and dependency status.

Interest rates for federal student loans are set every year using the results from the 10-year Treasury note auction each May. Those rates affect all federal student loans disbursed between July 1and June 30 of the upcoming year.

As a result of the economic fallout caused by the coronavirus pandemic, interest rates have fallen to record lows, which means that federal student loans for the upcoming 2020-2021 academic year will have the lowest rates in over a decade.

Here’s a breakdown of both the current and upcoming interest rates:

Federal Student Loan Rates: 2019-2020

  • Undergraduate Direct Subsidized and Unsubsidized loans - 4.53%
  • Graduate or Professional Unsubsidized loans - 6.08%
  • Direct PLUS loans - 7.08%

Federal Student Loan Rates: 2020-2021

  • Undergraduate Direct Subsidized and Unsubsidized loans - 2.75%
  • Graduate or Professional Unsubsidized loans - 4.30%
  • Direct PLUS loans - 5.30%

Compared to last year, students will be paying 1.78% less on interest, which could save you hundreds to thousands of dollars over the life of the loan. For example, if you took an undergraduate loan last year for $7,500 with a 4.53% interest rate, and a standard 10-year repayment plan, you will be paying around $1,840 worth of interest. If you take out that same loan this year, with the same repayment plan, but with the 2.75% interest rate, you’ll only be paying $1,087 worth of interest.

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Private Student Loan Rates

Private student loans are an option to bridge the financial gap when you’ve exhausted all other types of financial aid avenues, including federal loans.

Martin Lynch, compliance manager and director of education at Cambridge Credit Counseling Corp., says students should only use private loans as a last resort, and they should be as conservative as you possibly can with the amount you wish to borrow, and he suggests to only use them as a last resort.

“Always max out the federal loans first,” Lynch, who also serves the Financial Counseling Association of America’s board of directors, says.

Unlike federal loans, which only have fixed interest rates, private student loans offer both fixed and variable interest rates.The specific rate you get will depend on your (or your parents’) creditworthiness. With a fixed rate, payments stay the same over the life of the loan, while with a variable rate your payments may fluctuate based on current market conditions.

Most private student loans currently use the 3-month London Interbank Offered Rate, commonly known as “LIBOR,” as their baseline to set their interest rate ranges. The LIBOR usually follows the federal funds rate closely.

Last week, the Federal Reserve announced that the federal funds target rate will remain close to zero possibly until 2022. In other words, it’s unlikely private loan rates will increase in the near future.

Here are today’s private student loan rates for undergraduate students from some of the nation’s largest lenders:

Wells Fargo

  • Fixed: 4.78% - 10.97%
  • Variable: 2.93% - 9.70%


  • Fixed: 4.73% - 11.46%
  • Variable: 1.30% - 10%

Sallie Mae

  • Fixed: 4.74%- 11.85%
  • Variable: 1.25% - 9.44%


  • Fixed: 4.49% - 12.39%
  • Variable: 1.49% - 11.49%

College Ave

  • Fixed: 4.64% - 13.24%
  • Variable: 1.74% - 12.23%

Refinancing Student Loans

If you already have private student loans, there’s probably never been a better time to refinance. With benchmark interest rates so low, your chances of securing a better interest rate are extremely high, especially if you have a good credit score of 720 or over, and a steady source of income.

Refinancing your private student loans can help you save money by lowering your interest rate. In some cases, you can also lower your monthly payment. If you have more than one loan, this can also be an option to help you consolidate multiple payments into a single one, plus it can help you release a cosigner.

When it comes to federal student loans, refinancing may not be the best option. “You would lose some of the benefits, like access to forgiveness programs,” says Brenda Hicks, director of financial aid at Southwestern College in Winfield, Kansas.

“It's really tough to beat the federal student loan rate, even if it's an unsubsidized loan. Federal student loans are at 2.75% right now, and that's incredible. I don't think you're going to be able to get a better rate than that, unless you have an incredibly good credit or a cosigner that's amazing,” she adds. However, Hicks says that for private or parent loans, refinancing could be a good move because rates in the private sector are at all-time lows.

Let’s say you currently owe $10,000 on a private student loan with a 9% interest rate and 5 years remaining on the repayment term. With that loan, you’ll end up paying the balance of $10,000, in addition to $2,455 worth of interest.

If you refinance that $10,000 with the same 5-year term, but with a 4% interest rate, you’ll end up paying less each month and only $1,050 worth of interest. In this case, refinancing saved you $1,400.

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Here are today’s refinancing rates from some of the nation’s best-known refinance companies:


  • Fixed: 3.2% - 6.43%
  • Variable: 3.2% - 6.08%


  • Fixed: 3.45% - 6.68%
  • Variable: 2.64% - 6.68%


  • Fixed: 3.20% - 6.44%
  • Variable: 2.99% - 6.44%

More from Money:

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With Interest Rates Near All-Time Lows, Here’s What to Know About Refinancing Your Student Loans

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Rates are subject to change. All information provided here is accurate as of the publish date.