Given the coronavirus pandemic, the last thing on your mind is probably student loan debt. If you’re one of the 43 million people out there with federal student loan debt, there’s some good news in the $2 trillion dollar stimulus package for you. From March 13, 2020 through September 30, 2020 you don’t have to make any payments on your federal student loans.

Federal student loan borrowers who qualify are not required to sign up to receive anything. It’s done automatically for you. You do not have to make any student loan payments on your federal student loans during this time administrative forbearance time period, which is March 13, 2020 – September 30, 2020. Also, no interest will accrue on your student loan balance during this timeframe either.

If you made a payment during this time period (March 13, 2020, through Sept. 30, 2020) and would like a refund, you must contact your loan servicer to get a refund.

What if I want to make student loan payments?

You can still make payments on your student loans. Any payment you make during this coronavirus period (March 13, 2020 – September 30, 2020) will be applied directly to your principal balance. So you’ll save more money because the interest is being waived.

Are you one of the millions of people who are in student loan default?

The U.S. Department of Educations has also suspended the collection activities during this time. This includes those who may have been penalized on any tax refunds or social security checks. In fact, you could receive a refund if applicable. Please see further details from the U.S. Department of Education at the end of this blog post for more information.

What this means?

The average student loan borrower pays $400 per month on their loans. So this means you’ll have more money available to handle other expenses at this time.

*** A special thank you to Keisha for inspiring this post! ***

For more details on the benefits of this law, please check out StudentAid.gov. According to the U.S. Department of Education, these are some of the benefits borrowers can expect to receive:

Your payments will automatically stop from March 13, 2020, through Sept. 30, 2020.

To provide relief to student loan borrowers during the COVID-19 national emergency, federal student loan borrowers are automatically being placed in an administrative forbearance, which allows you to temporarily stop making your monthly loan payment. This suspension of payments will last until Sept. 30, 2020, but you can still make payments if you choose.

From March 13, 2020, through Sept. 30, 2020, the interest rate is 0% on the following types of federal student loans owned by ED:

  • Defaulted and nondefaulted Direct Loans
  • Defaulted and nondefaulted FFEL Program loans
  • Federal Perkins Loans

Please note that some FFEL Program loans are owned by commercial lenders, and some Perkins Loans are owned by the institution you attended. These loans are not eligible for this benefit at this time.

UPDATED: On March 25, 2020, ED announced that my federal tax refund would not be withheld to repay my defaulted federal student loan debt. My refund has already been taken. Will I get it back?

Yes, but only if your federal tax refund was in the process of being withheld—on or after March 13, 2020, and before Sept. 30, 2020—for the repayment of a defaulted federal student loan.

Your federal tax refund will not be returned to you if the process to withhold your refund was completed before March 13, 2020.

If you have questions about whether your federal tax refund was withheld, call ED’s Default Resolution Group at 1-800-621-3115 (TTY for the deaf or hearing-impaired 1-877-825-9923).

UPDATED: On March 25, 2020, ED announced that a portion of my Social Security payment, including disability benefits, would not be withheld to repay my defaulted federal student loan debt. My Social Security payment has already been taken. Will I get it back?

Yes. The portion of your Social Security payment that was taken will be returned to you if your payment was in the process of being withheld—on or after March 13, 2020, and before Sept. 30, 2020—for the repayment of a defaulted federal student loan.

The portion of your Social Security payment that was withheld will not be returned to you if the process to withhold it was completed before March 13, 2020.

If you have questions about whether your Social Security payment was withheld, call ED’s Default Resolution Group at 1-800-621-3115 (TTY for the deaf or hearing-impaired 1-877-825-9923).

StudentAid.gov

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