Financial Friday: Federal student loan payments resume on May 1
HUNTSVILLE, Ala. (WAFF) - Amid concerns of the COVID omicron variant, the Biden administration extended the payment pause for federal student loan borrowers until May 1. So, for two years now, borrowers have been given the option to pause their monthly bills without interest accruing on their debt. Almost all borrowers have accepted the relief, according to research.
A recent poll of student loan borrowers found nearly 90% are still not financially secure enough to restart payments. This is according to a poll done by the Student Debt Crisis Center (SDCC).
So with the payments resuming May 1, 2022, we talked to Kaeshier Fernandez a Financial Education Coordinator at Redstone Federal Credit Union.
He offered some advice on what you need to do as the time draws near to continue repayment.
Update your contact information with your federal loan service provider to ensure clear continued communication.
- If you were on auto-debit payments before March 13, 2020, your loan servicer will contact you before suspension ends to confirm whether or not you want to stay on auto-debit. Not responding to these communications could automatically end your auto-debit.
Research repayment plans and select one that would work best for your situation.
- Consider applying (or reapplying, if you’ve had an income change) for an Income-Driven Repayment (IDR) plan, which can make your payments more affordable depending on income and family size.
Be aware of Student Loan Scams!
- Stay alert of aggressive advertising to lure you into a scam.
- Never share your Federal Student Aid ID (FSA ID) username or password or enter in any third part authorizations or power of attorneys that will allow others access to your student loan accounts.
- Many fraudsters or student loan debt relief companies will ask for an up-front charge to use their services. Find free U.S. Department of Education loan servicers at: StudentAid.gov
For more ways to save, be sure to tune in at noon every Friday for WAFF 48′s “Financial Friday” segment.
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