John,
Last spring, after months of debt-ceiling negotiations with GOP House Speaker Kevin McCarthy, the Biden administration agreed to terminate the federal student loan payment pause — at a stroke, throwing 45 million people, a generation of borrowers, into renewed economic insecurity.
Now, student loan payments are set to resume tomorrow, October 1st — the same day Republican extremists are set to force a government shutdown.
Here’s what that means for you, and what you need to know before your official due date arrives:
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If the government is closed down, payments for student loans will still be due and interest will still accrue.
You’ll begin, or continue, paying your loans through your student loan servicer’s website. To find out your servicer, log in to your Federal Student Aid account and find the “My Loan Servicers” section.
Make sure to also review your banking information. If you enrolled in auto-pay prior to March 2020, you may have to opt in again.
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If your federal student loan repayment amount is too high for you to manage at this time, you may be eligible to lower your monthly student loan payment by enrolling in an income-driven repayment (IDR) plan.
With the Loan Simulator, you can calculate your student loan payments and choose a loan repayment option that best meets your needs and goals.
Note: After the Supreme Court struck down President Biden’s student loan forgiveness plan, the administration rolled out a new IDR plan called SAVE, which could cut your monthly payments for undergraduate loans in half, or reduce them to $0.
You can learn more and apply for SAVE directly on the Department of Education’s website.
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If you think you may miss a payment — don’t sweat it. You will not be subject to penalties or reported to credit agencies for the first 12 months after the pause ends.
The Biden administration has created a temporary “on-ramp” repayment program to help you avoid default or credit harm for missed, partial, or late payments between October 1, 2023 and September 30, 2024.
Interest, however, will still accrue during this forbearance period.
And that’s about it for now, John.
But we’re in this fight for the long haul and we’re not going to stop until we have a real solution to the student debt crisis.
The Biden administration is proceeding with steps to establish a new student loan forgiveness program under a different legal authority to replace the one struck down by the Supreme Court back in June — and we'll be closely tracking emerging details, including when the program is finalized and available for borrowers, over the next few months.
Make a contribution to help us keep up the pressure for student debt relief, and to elect more champions who will fight to make education accessible and affordable to every family in the U.S.
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And if you’d like to stay up-to-date on any upcoming changes related to student loans and repayment, please sign up for text updates from WFP by texting EDU to 30403.
In solidarity, always,
Working Families Party
