The federal government and department of education have extended the student loan repayment freeze one last time to January 31st, 2022. Expect to make a payment in February.
Here is a quick history of the repayment freeze:
- March 20th, 2020: the repayment freeze begins with payments suspended and interest set to 0% by the Office of Federal Student Aid.
- March 27th, 2020: CARES Act is passed as law and the payments suspension is set to expire on September 30th, 2020.
- August 8th, 2020: the first extension to the the repayment freeze is passed and the freeze is set to end on December 31st, 2020.
- December 4th, 2020: the second extension to the repayment freeze pushes repayment back to January 31st, 2021.
- January 20th, 2021: the third extension to the repayment freeze gives borrowers another 7 months of relief by extending the freeze to at least September 30th, 2021.
- August 6th, 2021: the final extension adds another 6 months of relief for borrowers by extending the repayment freeze to January 31st, 2022.
This time it's for real
This is the last extension we can expect from the Office of Federal Student Aid and the Department of Education. Here's how you can be best prepared:
- Make sure you update your account information with all your student loan servicers. You name, telephone number, email, and physical address is especially important.
- FedLoan and Granite State have decided they will not be servicing federal student loans any longer. If your loans are currently serviced by them keep an eye out for updates on who your new servicer will be.
- You will receive a notification at least 21 days before your first payment is due so keep an eye on your mail and email.
- The next six months with 0% interest are an opportunity to pay down as much of your student loans as you can. Even an extra $30 / month (just $1/day) can help you get to $0 student loans quicker. Shameless plug: with Dolr you can automatically put away $1 / day towards your student loans. For free.
- Be ready to start making those payments and do not rely on any additional loan forgiveness in the short term. Experts say it's unlikely any loan forgiveness is coming for the next couple years.