Bad news for millions of student loan borrowers in the United States: Your temporary financial break is coming to an end
After putting loan payments on hold in March because of the pandemic, lenders are preparing to resume accepting payments on student loans in January. That means an estimated 40 million U.S. citizens will have to start making monthly payments again.
The good news is borrowers won’t have to make up the interest payments they missed over the past nine months.
Federal student loans have been on pause since March, when the CARES Act gave borrowers relief during the coronavirus pandemic.to pausing monthly payments, the Department of Education also stopped interest from accruing during the down time and stopped collecting on defaulted federal loans. Interest will begin accruing again in January.
Absent an act from Congress including a new extension, 14% of student loan borrowers plan to skip student loan payments beginning January 1. Why? They expect that Congress or the president will cancel student loans.
More than 35% of student loan borrowers say they won’t be able to afford to make student loan payments again due to financial stress caused by COVID-19.
Susan Saunders
