The payment pause on federal student loans ends in less than 40 days. Borrowers haven't had to make payments and loans and loans haven't collected interest since March 2020 due to COVID-19. Payments, 0% interest rates, and collection on defaulted loans are suspended through Aug. 31. That is set to change Sept. 1 unless President Biden extends the payment moratorium again. Here are three things you should know before payments resume.
- Once the pause ends, at least 21 days before your payment is due, you will receive a statement or notice which include how much you owe and when it’s due.
- Auto-debit payments won’t restart automatically for most borrowers. You may have to opt in to confirm enrollment, according to FSA.
- Check forgiveness eligibility: you still have over three months to take advantage of a temporary waiver for a loan forgiveness program. The Public Service Loan Forgiveness program provides loan forgiveness to public service employees after 120 qualifying loan payments have been made.
To determine if you qualify, and for instructions on how to apply, click here.
The Biden administration is considering canceling $10,000 per borrower with the possibility that there would be restrictions based on income or the type of degree.
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