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Austin Justice Coalition

19 hours ago

"WASHINGTON — Americans will get a six-month reprieve from federal student loan payments as the coronavirus pandemic leads to job losses and economic turmoil nationwide.

As part of the coronavirus relief bill passed through Congress and signed by President Donald Trump on Friday, lenders must stop all payments for federal student loans through Sept. 30. During that time, interest will not accrue on the loans and nonpayment during that period cannot be used to affect credit scores or a person’s qualification for loan forgiveness. According to the bill’s text, “each month for which a loan payment was suspended” will be treated as if “the borrower of the loan had made a payment.”

The bill also suspends any wage garnishment or tax refund reduction for people who have defaulted on their federal student loans. It does not, however, have any effect on private student loans, though the vast majority of the $1.64 trillion in student debt in the US is federal. Private loans made up about 12% of all education loans in 2018–2019, according to the College Board." ...