The U.S. Office of Federal Student Aid announced that it will provide student loan relief for students across the country during the COVID-19 national emergency.
The two main announcements included:
- All borrowers with federally held student loans will automatically have their interest rates set to 0% for a period of at least 60 days.
- Every borrower will have the option to suspend their repayments for at least two months to allow them greater flexibility during the national emergency. This will allow borrowers to temporarily stop their payments without worrying about accruing interest.
U.S. Secretary of Education Betsy DeVos has directed all federal student loan servicers to grant an administrative forbearance to any borrower with a federally held loan who requests one. The forbearance will be in effect for a period of at least 60 days, beginning on March 13, 2020. To request this forbearance, borrowers should contact their loan servicer online or by phone.
DeVos also authorized an automatic suspension of repayments for any borrower more than 31 days delinquent as of March 13, 2020, or who becomes more than 31 days delinquent, essentially giving borrowers a safety net during the national emergency.
Some borrowers may want to continue making payments, like those seeking Public Service Loan Forgiveness or those enrolled in a repayment plan with a manageable monthly payment. For borrowers continuing to make payments, the full amount of their repayment will be applied to the principal amount of their loan once all interest accrued prior to the president’s March 13 announcement is paid. The Department will work closely with Congress to ensure all student borrowers, including those in income driven repayment plans, receive needed support during this emergency.
Any borrower who has experienced a change in income can contact their loan servicer to discuss lowering their monthly payment.