Almost 45 million Americans have student loans, and during months where everything seems uncertain, making those payments can be challenging.
SDSU Extension Family Resource Management Field Specialist Lorna Saboe-Wounded Head says the first thing you need to know is who owns your loans. She says the CARES Act only applies to any federal loans, not loans that have been consolidated with private lenders.
Information related to loan ownership can be found online at www.studentaid.gov/login. Private companies MAY still offer assistance during the pandemic, but aren’t subject to the same rules outlined on the student aid website.
Saboe-Wounded Head says if you are still able to pay, keep making payments because they reduce the principle of your loan after accrued interest is paid. She says that means you could be paying off more of your original debt by sticking with your monthly payments during the pandemic.
Saboe-Wounded Head says the CARES Act includes a break in student loan interest accrual and suspension of payments until September 30, 2020, for loans with the Department of Education. Perkins loans would also fall under this category if they were held by the Department of Education, but not if held by the individual school, for example.
Suspended payments count towards income-driven repayments plans and public service loan forgiveness. The payment and interest suspension were backdated to March 13 instead of March 27, so suspended payments count towards loan rehabilitation, and garnished wages and tax refunds seized after March 13, 2020, can be refunded.
For more information, email Lorna.woundedhead@sdstate.edu or call 605-782-3290.
