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Student Loan Payments On Hold for until Oct 2020

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    Due to the current state of things, you are no longer required to make any payments whatsoever on your federal student loans until September 30th of 2020. Interest cannot accrue during that time either and not paying will not effect your credit score in any way.

    This only applies to federal student loans that are currently held by the federal government though, which accounts for ~88% of all loans. If you have a private student loan, like a Sallie Mae or even some FFEL Program and Perkins loans, you will still be required to make payments on those loans. Be sure and check with your lender to see if you qualify for this or not.

    The CARES Act that was just signed into law orders all lenders and collection agencies in charge of federal student loan payments to halt any attempt to collect student loan payments for the next 6 months. And when they start up again they have to give you 6 notices when payments are required to start up again. So this isn't something you have to sign up for. It is something agencies and companies are required by law to do.

    You are still allowed to make payments on your loans during this time though, and the good news is anything you do pay for the next 6 months goes purely to your principle balance.

    Also if you were getting your income garnished or your tax refund was being reduced due to student loan collections, that is also being suspended for 6 months.

    All these effects take place immediately. And it's possible Congress will take further action in regards to student loans in the future. Democrats were at first trying to push for various forms of Student Loan Forgiveness but that did not make it into this current stimulus package. However they are expected to meet up again starting April 20th so it is possible for more relief in the future. Or an extension of suspensions.

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    This is great news for anyone affected by this. It's pretty refreshing to see the government actually put stuff like this into immediate action when it becomes necessary. It's also nice to see that the ones who are still making loan payments get the amount put directly to their primary. That has to feel nice as well.

    On the flipside of that, I think they should have made it for the entire student loan program. I'm not sure of all the details in that area, though it doesn't seem impossible to do considering everything else that is going on right now.

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    PentagonWall Wrote:

    On the flipside of that, I think they should have made it for the entire student loan program. I'm not sure of all the details in that area, though it doesn't seem impossible to do considering everything else that is going on right now.

    I totally agree. I wouldn't be surprised to see something else like this come down the pipe line, depending on how much longer this will go on for, and how intense it gets. The banks are going to want to go after these debts, especially if they take a hit or two while the economy teeters on recession.