As many of us with student loans know, on March 20, 2020 the Secretary of Education put in place student loan relief because of COVID. The following is what she applied to all federally held student loans:
- Suspend loan payments
- Stop all collections on defaulted loans
- Set interest rates to 0% for a period of 60 days
With the continuation of the spread of COVID the President directed the Secretary of Education to extend the deadline to December 31, 2020. With this date fast approaching we want to make sure that you are preparing to meet it head on and make sure that you are keeping up with your student loans and the required payments.
If you can make payments toward your loans, we highly recommend that you do so. With 0% interest, your full payment will go toward the balance with none of it going to interest. Which will pay you’re your loan much fasted. Since your loan is suspended, there are no penalties or fees accumulating on your loan so not making payments is still fine.
If your loans were in default, good news, your loans are being rehabbed making this a great time to work out arrangements with the Federal Government to get them repaid at the regular payment, income based or forgiven by one of their many programs that they offer. Giving them a call (1-855-265-4038) or going to their website is the best way to get in touch with them.
So, what should I do next? If you can make a payment toward your loans do so. If you are in default, contact www.studentloans.gov to set up a repayment plan and get your loan(s) rehabilitated. If you were current on your loans and/or on a repayment or forgiveness plan when payments are required again, you will still be signed up and will just continue with the plan you had before March 20, 2020.
Always be ready to make a payment or for payments to begin again in January 2021, it will be a bit of a waiting game to see what will happen next and where COVID will take us in the New Year.