05/14/2020: Student Loans vs. COVID 19
As part of the governments CARES Act (Coronavirus Aid, Relief & Economic Security) you may have some flexibility when it comes to paying your student loans. Below are options outlined by the Federal Trade Commission as a guide to paying back your student loans during the Coronavirus outbreak. The program is currently open through September 30, 2020.
From the FTC:
So what does the CARES Act mean for you if you have a federal student loan?
1. The CARES Act gives temporary payment relief to borrowers with qualifying federal student loans. Some federal student loans don’t qualify – for example, older Family Federal Education Loan (FFEL) program loans or Perkins Loans that are owned by the school you attended. Contact your federal loan service online or by phone to find out if your loans are eligible.
2. If your federal loans are covered, the Department of Education has automatically placed your loans into what’s called “administrative forbearance.” That means you can stop making payments on those loans right away, up through September 30, 2020. If your payments automatically come out of your bank account, check if any payments have been processed since March 13. If they have, you may be able to get a refund as part of administrative forbearance.
3. If you want to keep making payments on your qualifying federal student loan through September 30, the interest rate is now 0%. So any payments you make during forbearance may help you pay off your debt faster. If you’re on an income-based repayment program and/or a forgiveness program, you should check out Federal Student Aid’s Coronavirus page to see which option makes sense for you.
4. If your federal student loans are in default, the Department of Education has stopped making collection calls, and sending letters or billing statements through September 30, 2020
More information can be found on the Federal Trade Commission’s website.