Learn the latest changes to student debt interest and payments and how it affects you.
Note that these benefits and changes are for federal loans.
0% interest for 6 months, until Sept 30, 2020 (backdated to March 13, 2020), this happens automatically.
Payments are suspended for 6 months until Sept 30, 2020, this happens automatically.
The 6 mo of suspended payments count towards loan forgiveness programs, including Public Service Loan Forgiveness (PSLF) and Income Driven Forgiveness (PAYE, REPAYE, IBR).
Employers will receive a tax break when they contribute to their employees’ student loans.
Borrowers in default will have their 6 months of suspended payments count towards the nine months needed for loan rehabilitation.
No collection, wage garnishment, or seizure of tax refunds will happen (backdated to March 13, 2020)
Which loans are eligible for these benefits?
All federally-owned loans are eligible.
According to studentaid.gov, "All loans owned by the U.S. Department of Education (ED) will have interest waived. That includes Direct Loans, as well as Federal Perkins Loans and Federal Family Education Loan (FFEL) Program loans held by ED.
Please note that some FFEL Program loans are owned by commercial lenders, and some Perkins Loans are held by the institution you attended. These loans are not eligible for this benefit at this time."
Do I need to apply to suspend my payments or for the 0% interest?
No. Federal student loan borrowers do not need to take any action to suspend payments. Your federal student loan servicer will suspend all payments without any action from you. If you want to double-check or change your autopay settings, you can call your servicer. Here is a list of federal loan servicer numbers.
How can Snowball Wealth help you with your student loans during COVID?
Here is what we can help you with:
👀 see loans in one place
✍️ track monthly payment
💸 know if you should be taking action on your debt during and after the COVID-19 suspensions
💡 know if it is a good idea to refinance now or after the suspension
📉 compare payment strategies
Sign up for free here.
Official federal loan site (studentaid.gov)
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