State reduces interest rate on SELF loan

The Minnesota Office of Higher Education has reduced the interest rate on one of its student loans.

The variable rate on the SELF Loan is now 3.5 percent, down from 4 percent. That saves students and their families about $50 a year on a $10,000 loan, state officials said.

Last year, more than 16,000 Minnesotans borrowed through the state. Office Director Larry Pogemiller said Minnesota is one of 15 states with a low-rate loan program.

"Usually the Minnesota state SELF Loan program is at a lower interest rate than the federal loan program," Pogemiller said.. "We would like to encourage families to look at the Minnesota program before they go to the federal loan."

The current rate for subsidized federal Stafford Loans is 3.4 percent. But that rate could expire next year. Unsubsidized federal loans have a rate of 6.8 percent.