The abolition of interest and postponement of payments: what you need to know about student loans during the outbreak of coronavirus

If you are worried about your studies or the repayment of the loan, publishing Federal Student Aid gathered all the information to help you understand what to do in circumstances of emergency due to the coronavirus.

Отмена процентов и отсрочка выплат: что нужно знать о студенческих кредитах во время вспышки коронавируса

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You can temporarily stop making payments

To assist borrowers in times of emergency with COVID-19 you can temporarily stop paying the monthly payment on the loan.

Information for students

What if the campus is closed due to the coronavirus? Is it possible to finish the semester and keep Federal aid to students?

Please contact the University. Many educational institutions are taking measures (such as homework or online classes) so the students could finish the semester.

If the campus will be closed or will only offer online instruction will I receive payment for the hours when I can’t work on its Federal work-study?

If you are unable to work as scheduled because of failures associated with coronavirus (such as the closure of the University or quarantine students) your University may pay for any scheduled hours or to allow you to work in a different way, for example by doing the job online, depending on the type of work.

My mom can’t go to work because of the coronavirus, and it is not paid, if it doesn’t work. This means that my financial need has increased. Can I get more financial aid?

Talk to the financial aid office at the University. They have options for the students so they could continue their education.

Someone in my family is a coronavirus, so the whole family has been quarantined and I can’t attend classes. How can I learn not to miss classes and lose financial aid?

Contact the financial aid office of the University and to the academic Advisor/coach or program coordinator, to obtain additional guidance on the situation with financial aid. In addition, if you need to take a vacation during the outbreak of coronavirus, should talk to the financial aid office of the University.

Many universities offer detailed solutions and recommendations concerning the coronavirus, for students. Check the web site of the institution and account of a social network subject to the availability of resources and the latest information about the situation.

If my school goes to classes online, will I get less financial aid?

If your school has transferred classes in the online format, you should continue to engage in course work and to follow the directions of your teacher or Professor to be eligible to receive financial assistance.

How do I contact the financial aid office of the institution if it’s closed?

Check the website of your school for contact information. The account verified by the social networks, they can be a good source of the latest information on how to contact schools. Although many universities have translated internal courses in online learning, most of them remain open and accessible.

Information for borrowers

March 13, 2020, the President of the United States Donald trump announced the cancellation of the interest on all Federal loans for education. What loans are included in the ad?

For all loans owned by the U.S. Department of education (ED) will be terminated nachisleniya percent. This includes direct loans, and Federal loans programs Perkins loan and Federal family education (FFEL) owned by ED.

Please note that some of the loans under the FFEL owned by commercial lenders and some loans Perkins belong to the educational institution. These loans are not eligible for this benefit.

The Department of education announced that all borrowers with Federal loans are automatically set interest rates at 0% for at least 60 days from March 13. Also borrowers with Federal loans have the opportunity to suspend payments for at least two months without interest, writes CNBC.

While the interest rate reduction is automatic, borrowers must request a suspension of payment is called a deferred, their creditors online or by phone. This can help free up funds for other bills or financial obligations during the crisis of coronavirus.

“It’s something that I highly recommend for people who have recently lost their job or have reduced working hours due to emergency situation in the country,” said Michael Bloch, CEO and founder of Pillar, apps for personal Finance.

As a rule, the suspension of payments in the long run it costs the borrower more expensive because interest continues to accrue and is added to the principal balance of the loan. But if borrowers will contact your creditors now, they’ll get a reprieve for several months without increase of interest.

However, if you can make your payments, you still should, says Bloch.

“All Federal student loans temporarily is charged on 0%,” he says. “This means that the borrower payments will go further in the direction of payment of principal and quicker recovery from debt.”

How can I use this program if I have a Federal program of loans for education (FFEL) and Federal Perkins loans not owned by ED?

You can consolidate your FFEL program or Federal Perkins loans not owned by ED, the direct consolidation loan, which will be eligible for benefits. However, if you consolidarea them and after the abolition of interest, the interest rate may be higher than what you pay at present, and any outstanding interest will be added to your main balance.

Can anyone tell me whether the reduced interest rate on my loans?

Contact your borrower online or by phone to determine if your credits under the benefit. If you don’t know who your borrower or how to contact him, visit StudentAid.gov/login or call 1-800-4-FED-AID (1-800-433-3243; TTY for the deaf or persons with hearing impairments 1-800-730-8913) for assistance.

If my loans owned by ED, do I need to do something to cancel the interest on my loans?

No, ED will automatically configure your account so no interest is accrued. The adjustment account entered into force on 13 March 2020. During this grace period, if you continue to make payments, the full amount will be credited to the principal amount. However, if your loan has accrued interest up to the Declaration of President trump benefits, your payments will first be used to repay this outstanding debt.

Will have reduced my monthly payment because of the abolition of interest?

No. Your monthly payment will remain the same, but the full amount of the payment will be applied to already accrued interest or outstanding principal amount. This means that you repay your loan faster during this period with zero interest.

If I make payments after March 13, they will be applied?

During the grace period, the full amount of your payments will be applied to the principal amount after payment of all interest. You can suspend your payments at least 60 days without additional interest accruing.

How long interest rates will be abolished?

Interest on student loans held by the Federal government do not accrue for at least 60 days from March 13, 2020. ED may extend this deadline depending on the status of emergency in the country associated with COVID-19.

On 20 March, the President said that I can suspend payments on their loans. What I need to do to suspend my payments?

You can request a continuance. To be in the delay means you can temporarily stop payments Federal student loan, without entering in default. Because during a state of emergency COVID-19 percent are cancelled, interest will not accumulate. If you request a postponement, you will have no payments during the term. Your credit provider will cancel any scheduled automatic payments. After deferment, you will have to resume payments. If you want to use auto-debit, you can restart automatic payments.

What if I have overdue payment of more than 31 days?

If you at least 31 days have delayed their payments as of March 13, 2020, you will automatically be subjected to the delay to give you insurance during COVID – 19.

If I want delay, do I have to request it or I get it automatically?

If you want to obtain a deferment, you must request it by contacting your borrower. If you don’t know who your lender is or how to contact him, visit StudentAid.gov/login or call 1-800-4-FED-AID (1-800-433-3243; TTY for the deaf or persons with hearing impairments 1-800-730-8913) for assistance.

Whether the right private student loan for this benefit?

No. ED has no legal authority over private student loans, so they do not fall under the statement of the President.

How long is the delay?

The delay will last at least 60 days from March 13, 2020. ED may extend this period depending on the status of emergency in the country associated with COVID-19. If the option of deferral will be extended, your loan agent will inform you about the extension.

Is there any reason I can not preostanovlena their payments?

If you seek debt relief Program forgiveness loan public service (PSLF). She forgives the remaining amount on your direct loans after you have completed 120 (10 years) of qualifying monthly payments in accordance with repayment schedule, working full time. In this case, you may not want to be subjected to delay, because the time spent in the delay shall not be counted in required payments. However, if your income has changed, you may qualify for a lower monthly payment. If you participate in the IDR plan and your income has significantly changed, you can update your information and get the new payment amount. To do this, go to the page StudentAid.gov/idr click “Apply now”, and then start the application by pressing the button “Recalculate my monthly payment”.

If you can afford to make payments on the loan during a state of emergency COVID-19, you can continue to do so to pay off as much of its loan at an interest rate of 0%.

How do I know when interest will again begin to accumulate?

Lenders will also contact you to inform you that you will need to begin to make payments.

What should I do if my loan is in deferment?

If your loan is already in deferment, it will cease the accrual of interest, starting from March 13, 2020, at least 60 days. However, when this period passes, any interest accrued during the grace period until March 13, 2020, will be capitalized, which means that any outstanding interest will be added to your main balance.

What if I want to continue to make payments?

If you want to continue to pay their loans based on the current monthly payment, you can do it. You don’t need to contact anyone, if you want to continue to make payments. This can help you to quickly pay off the balance on the loan, because the entire amount of your monthly payments will be applied to the principal amount, will be paid as soon as all the interest.

If you are experiencing difficulties with money, please as soon as possible contact your borrower to discuss options to reduce or suspend your payments.

What if I want to make a partial payment?

While you are under the benefits, you will not be penalized for making a payment that is less than your normal monthly payment. Meanwhile, you still have the ability to make payment on the loan in order to make progress in reducing balance.

My company closed due COVID-19. I don’t make money and can’t pay the bill on a student loan. Can I stop making payments while I again won’t work?

If you have any problems with the payment as soon as possible contact your borrower. If you have a Federal Perkins loan, please contact there. You can easily avoid the consequences of delay or non-performance of obligations, staying in touch with your lender.

It can provide information about rescheduling options which will allow you to temporarily stop loan payments. You can also switch to another repayment plan that will provide you with a lower monthly payment.

Currently I have a payment plan based on income. I make much less money due to the outbreak of coronavirus and don’t know when my income will return to the same level. What can I do?

If you make significant changes to your income, you can at any time ask to recalculate your monthly payment. Your borrower may to provide more information.

I make my payments and hope to receive the forgiveness of loans to public servants (PSLF), but now I can’t work due to the coronavirus. If I miss a payment, can I still qualify for PSLF?

If you do not make the payment within one month, or introduce a delay because they can not afford the payment that month did not count towards PSLF. However, the payments do not have to be sequential, so you don’t lose payments already made. If you believe that your work will influence for a long period of time, you may be re-certified your repayment plan ahead of time to account for the income drop.

Of course, PSLF requires you to work full time on the relevant employer to obtain a loan for the PSLF. If your employer believes that you work full time during this period, then that month or those months will not count towards PSLF, even if you make the payment. However, paid sick leave, or other leave time may be counted by your employer as hours worked for purposes of PSLF. To learn more about PSLF, visit StudentAid.gov/publicservice. To learn more about payments based on income, visit StudentAid.gov/idr.

On March 25, 2020 ED announced that there will be withholding my refund Federal tax, to repay my debt for Federal student loan. My refund has already been taken. Can I get it back?

A refund of Federal taxes will be returned to you if your refund was in the process of retention — March 13, 2020 or after that date. Refund of Federal taxes you will not be refunded if the process of deduction of the refund was completed prior to March 13, 2020.

If you have questions about whether delayed return of Federal taxes, call the group to solve the problems of ED on the phone 1-800-621-3115 (TTY for the deaf or hard of hearing 1-877-825-9923).

March 25, 2020, ED announced that it is part of my social security payments, including disability benefits, will not be charged to repay my debt to default on Federal student loan. My payment has already been adopted. Can I get it back?

The part you have received payment, social security will be returned to you if your payment was in the process of retention — March 13, 2020 or after that date. Part of your payment withheld for social security will not be returned to you if the process of retention was completed prior to March 13, 2020.

If you have questions about whether your payment withheld for social security, call the group permission problems ED on the phone 1-800-621-3115 (TTY for the deaf or hard of hearing 1-877-825-9923).

On March 25, 2020 ED announced that private agencies on gathering of payments have ceased to make debt collection calls and send letters or to issue invoices. What should I do if I want to continue with the payment which I started before the announcement of ED?

You can continue the payment agreement associated with the non-payment of Federal student loan. Private agencies on gathering of payments was instructed not to call you, but they can help you if you contact him during this period. For assistance in continuing your current payment agreement call the group ED on the phone 1-800-621-3115 (TTY for the deaf or hard of hearing 1-877-825-9923).

On March 25, 2020 ED announced that private agencies on gathering of payments have ceased to make debt collection calls and send letters or to issue invoices. What do I do if I want to consolidate your defaulted Federal student loans or to start the procedure of rehabilitation loans now?

To join or to start the procedure of rehabilitation loans associated with your defaulted Federal student loans, call the group permission defaults to ED on the phone 1-800-621-3115 (TTY for the deaf or hard of hearing 1-877-825-9923) for assistance.

Does the delay e to pay for rehabilitation loans?

The delay, announced on 20 March 2020 not applicable to loans outstanding under the program of rehabilitation. However, ED stopped collecting payments on overdue loans for at least 60 days beginning March 13.

After you have successfully completed the restoration of your loan you can put your loans under administrative control, if that option still exists. Recall that ED announced that the deferral option will be available for at least 60 days beginning March 13.

Whether accrued interest on my outstanding loan?

On overdue loans owned by ED, do not accrue interest during at least 60 days beginning March 13. This includes direct loans and loan companies Federal Perkins loans program FFEL owned by ED.

What will happen after the 60-day period, associated with the termination of benefits?

ED actively monitors national emergency COVID-19 and may extend the 60-day period. After the 60-day period, your lender will give you information about the renewal of your payments. The message can be sent by email or posted to your account.

Websites for more information

Here are a few sites that may be useful:

  • Coronavirus.gov Centers for control and prevention of disease offer this site, which has everything from tips for prevention, common symptoms and current updates on the number of cases in the United States, to travel advice and a list of frequently asked questions.
  • Page for coronavirus USA.gov — USAGov explains how the Ministry of the Federal government respond to the outbreak.
  • Federal service student loans. The web site lists contact details of service centers for borrowers who want to ask questions, request a deferral or denial, etc.
  • The U.S. Department of education COVID-19 information for schools and school staff
  • Information for professionals for financial assistance

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