She Strengthens

Navigating Student Loan Relief During Uncertain Times

The current economic climate has left millions of people struggling to make ends meet. With over 30 million jobless claims filed in recent months, it’s essential to understand your options for managing student loan debt.

Understanding Your Loan Type

The first step in seeking relief is to determine what type of student debt you have. Federal student loans, managed by the United States Department of Education, are currently in administrative forbearance, meaning interest rates are set at 0% and payments are suspended until September 30th, 2020. This includes Federal Perkins Loans, Direct Loans, and FFEL Program loans.

Federal Loan Options

If you’re unable to make regular payments after the forbearance period, you may be eligible for income-driven repayment plans. These plans adjust your monthly payment based on your income, ensuring you only pay what you can afford. However, be aware that this may increase your overall debt due to interest accrual.

Private Loan Options

If you have a private loan, reach out to your loan servicer to discuss available options. While private loans aren’t covered by the CARES Act, many lenders are offering temporary payment suspensions. Keep in mind that interest may still accrue, increasing your overall debt.

Unemployment Benefits

If you’ve lost your job, explore your eligibility for unemployment benefits. The guidelines for these benefits have been relaxed during the COVID-19 pandemic, with an additional $600 added to weekly benefits. Check your state’s unemployment program for specific rules and guidelines.

Making Payments

If possible, consider making payments as normal. While it may be tempting to take a break from payments, doing so can increase your overall debt. If you have an emergency fund, a stable job, and a comfortable income, continue making payments towards your private and federal student loans.

Seeking Clarity

These are challenging times, and it’s essential to research your options carefully. Don’t hesitate to contact your loan servicer if you’re unsure about their policies or procedures. By understanding your options and taking proactive steps, you can navigate student loan relief and achieve financial stability.