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Repayment Restart: News, Updates and Advice

Introduction

We are in an extraordinary time for student loans.  Never have student loans been put on pause, especially for over three years and consequently, never have 40 million plus borrowers all entered repayment at the same time.  Things are changing almost daily and outside of the norm.  To help ensure student loan consumers have the most accurate and up to date information needed to successfully manage their loans, this page will be updated frequently as new guidance becomes available.  Updates will be dated.

As usual, we always encourage you to keep track of the information provided on www.studentaid.gov  

Frequently Asked Questions

Last Updated December 3, 2023

  1. When will interest begin accruing on federal student loans eligible for the COVID-19 pause?
    1. According to recent quotes from the ED in reliable news sources, interest will begin accruing on September 1, 2023
  2. When will my first payment be due after the pause?
    1. Most borrowers will see their first payment due during the month of October, 2023.  Likely on the same monthly payment due date they had prior to the pause.
  3. Do I have to re-apply for automatic payments if I was on ACH prior to the pause?
    1. Yes.  You can do so by contacting the loan servicer.  Many have the option available online.
  4. Where can I find information about the new income driven plan/revised REPAYE plan?
    1. You can find information about the REPAYE/SAVE plan on the Direct loan repayment plan page on our site.
  5. My loans are in default.  Will the Fresh Start program put me back into repayment early?
    1. No.  The Fresh Start program will not put your into repayment sooner than the current October date.  It will prevent future wage garnishment and tax refund garnishment and will allow you access to lower payment options as well as the one time IDR adjustment.  
  6. The Supreme Court denied the Biden/Harris Debt Relief.  Does that mean forgiveness is off the table?
    1. Not necessarily.  The ED is going to try again through the negotiated rulemaking process, which will take close to a year.  The one time account adjustment is also still pending, which will result in forgiveness for borrowers who have been in repayment for decades, and get others closer to that point.
  7. The Supreme Court did not approve the Biden/Harris debt relief,  will I have to repay the covid refund I received?
    1. Yes.  However you can choose to repay that refund as part of a regular repayment plan or schedule under the normal terms of your loan.  You can also repay it as a lump sum if you choose.
  8. Will September count as a payment towards forgiveness for PSLF and the income driven plans?
    1. Yes, assuming your loans aren’t in an in school status, grace, default or other ineligible status.
  9. My loan has been put into forbearance without my request.  What does this mean?
    1. The ED has announced that accounts where the payment plan has been delayed in processing or not processed correctly will be placed in administrative forbearance.  These periods will count towards PSLF and IDR forgiveness and interest will be waived for these periods in the coming months. It is unclear at this time how long these forbearances will last and when the interest adjustment will be made.
  10. My account was taken out of its repayment plan for no reason.  What do I do?
    1. This is a common issue we’ve seen.  Contact the loan servicer and request to be put back on your income driven plan.  If they request you submit a new IDR application request a supervisor.  You should not be required to submit a new IDR application at this time.

 

What Should I Do to Prepare for the End of the Pause?

There are several things you can do to put yourself in a good position when payments restart:

  1. Log in to www.studentaid.gov and verify who your loan servicer is.  During the pause, over 17 million borrower accounts changed servicers.
  2. Log on to your loan servicers website and ensure all of your contact information is correct.  This includes snail mail, email and phone.
  3. While logged into the servicer website, check and see what your payment was prior to the pause.  That will be your payments when payments resume unless you apply for a different option.
  4. If you cannot afford your payment, review our repayment plan page and use our repayment calculator to determine which plan will work best for your budget and financial goals.
  5. If you need to apply for a new plan you can do so now without your loans being put back into repayment early.  You can apply through your loan servicer or, for the income driven plans, on the ED website.
  6. As the months go by, be sure to read all communications from your servicer and the Department of Education to ensure you don’t miss any important deadlines or information.
  7. Be patient.  Despite robust preparations by the Department of Education and the servicers, the system was simply not set up in anticipation of an event where 40 million borrowers all re-entered repayment at the same time.  We expect long call hold times and perhaps long paperwork processing times for what could be a long while.