President Biden issued a presidential directive intended to help struggling Americans.
In particular, this directive specifically addressed the issue of student debt by extending the administrative forbearance on student loan payments and waiving of interest through September 30, 2021.
Here’s what borrowers need to know:
- All borrowers with federally-held student loans will continue to have their payments and interest automatically suspended through September 30, 2021 without penalty. (Borrowers will still have the option to make payments during this period if they choose.)
- Wage garnishments and collections for defaulted federally-held loans will continue to be paused through September 30, 2021. (and eligible for refund for any borrowers who continue to experience those garnishments.)
- Suspended payments will count toward Public Service Loan Forgiveness (PSLF) and Temporary Expanded PSLF(TEPSLF), through September 30, 2021, as long as borrowers meet all other requirements. (The same goes for suspended payments made by borrowers on income-driven repayment (IDR) plans: they will count towards required payments in order to receive forgiveness under that IDR plan.)
- Borrowers already enrolled in IDR plans will not need to recertify their income before the end of the year, regardless of if their original recertification date would have occurred before September 30, 2021. (The Department of Education has not released a specific timeline on recertification yet, but borrowers will be notified of their new recertification dates before they must recertify.)
Find the official Department of Education guidance regarding all coronavirus relief efforts here. https://studentaid.gov/announcements-events/coronavirus