The longstanding student loan pause is ending in the coming days.
You may have noticed emails alerting you that payments are due soon. That is because, beginning in October, the Department of Education will resume collecting loan repayments. Politico reports that interest on federal student loans had begun accruing at the start of September. Millions of dollars have been issued in student loan forgiveness. Unfortunately, not everyone has qualified, meaning roughly 28 million Americans are expected to cough up the funds for their loans.
This news comes as the government faces a possible shutdown if lawmakers cannot agree on appropriate funding. If this happens, federal employees could go without pay until Congress and the White House can come to a resolution. However, even if a shutdown occurs, student loan borrowers are still expected to repay their debts.
Borrowers have not been expected to make payments on their loans since 2020. Many people are still reeling from the COVID-19 pandemic, which saw unprecedented layoffs and business closings. Therefore, having to start paying back the money could prove a significant challenge. The Biden administration has tried several times to enact more loan forgiveness programs ahead of the repayment date. However, they have been met with several hurdles. New repayment options have been put in place to ease the expenses. One such plan, known as SAVE, may allow selected borrowers who make $32,800 or less a $0 monthly payment.
Still, the payment plans are subject to qualifications, so borrowers should not get their hopes too high.
