During the COVID-19 pandemic the Department of Education put a temporary moratorium on student loan payments. This moratorium was set to expire on April 31st but has been extended through August 2022. This pause in payments is in an effort to help individuals with student loans adjust to the economic impacts of the pandemic.
Federal student loan payments will be paused through August 2022. The Biden administration is hoping individuals will take this time to prepare for their repayments to begin. Click this link to read more about what this means for your student loans.
Who Is Impacted?
Those who have federal student loans will be eligible for the extended pause on payments. It's likely that you know by this stage of the pandemic if your student loans are held by the federal government and or through a private lender. Please note not all federal student loans are eligible for this forbearance. Check to see if your loan is eligible here. If you have student loans through a private lender, keep on making payments.
When Will Repayments Start?
Repayments are expected to begin on September 1, 2022. You may also notice you have a new loan servicer (the company that processes your payment). Many student loan servicers are changing and you should receive communication from your current servicers as well as your new one once your account has been transferred. As much as we hope big transitions like this are seamless, it would be a good idea to download your payment history as well as monitor your credit report to make sure wrong information isn’t being reported. If your payments come out automatically they “should” continue to come out, but it is still your responsibility to make sure they are being made and going to the right place.
What Should I Do?
Now may be a good time to prepare for your payments to begin in the fall. Updating your monthly budget to reflect what those payments might look like and then practicing those payments will help smooth out the transition in August as well as give your savings account an additional boost