Amid the coronavirus crisis, President Donald Trump announced he’d waive student loan interest and allow borrowers to put off payments as of March 13, 2020. The Department of Education then elaborated on the president’s notice stating that student loan borrowers can suspend their federal student loan payments without accruing interest for 60 days.
Trump said:
Borrowers should contact their lenders, but we’ve given them very strong instructions.
Trump then suggested that the policy could be kept in effect longer if required.
Rep. Alexandria Ocasio-Cortez (D-NY) tweeted:
[The goal is to help borrowers from] incurring additional fees, compounding interest or negative incidents reflected in their credit scores.
Beginning March 13, all borrowers with federally held student loans will have their interest rates set to 0% automatically for at least two months. To pause (suspend) payment without penalty as well, the borrower has to contact their student loan servicer to request an administrative forbearance. Usually, that is a bit of a complicated procedure, but in this case, loan servicers are required to grant forbearance to anyone who requests one. Also, those who wish to continue paying their loan can.
Note: The suspension of payment doesn’t wipe away the debt, and the interest waiver won’t lower your payments.
This announcement doesn’t apply to private student loans, only federal student loans. For now, regular payments for private student loans are still due.
