U.S. Waives Federal Student Loan Payments
The Trump Administration is acknowledging the strain that COVID-19 is putting on Americans’ finances by deciding to suspend federal student loans through September 30, 2020, which has never happened before in the history of the United States.
According to the U.S. Department of Education, any borrower with a federal student loan will also have their interest waived automatically, so no one will have to worry about filing a waiver. Individuals can still pay their federal student loans even though they’re suspended by making the same monthly payments. It’s important to note that student loan suspension does not include private student loans.
Good news is also in store for those who have defaulted on their student loans or haven’t made payments in at least 270 days, in that the federal government has also halted garnishment of wages, tax refunds, and Social Security benefits for student loan debt collection through September. Those who have defaulted in the past should consider getting out of student loan default during this time.
These changes are a part of the CARES Act that President Donald Trump has signed, which includes a $2 trillion stimulus package. Employers now have until the end of 2020 to pay up to $5,250 of their employees’ student loans tax-free.
What If I Have Private Student Loans?
Though private student loans are not covered under the CARES Act, you still have options. Some private lenders allow borrowers to put a pause on their payments, which is different from a suspension in that interest may still accrue on your balance.
It’s best to contact your lender or servicer to inquire about pausing your payments due to economic hardship.
Now Is the Time for Refinancing
If you’re currently employed and have a stable income, you may want to think about refinancing your student loans to save thousands of dollars, as student loan refinancing rates have dropped significantly. Refinancing occurs when a private lender pays your existing loans and replaces them with a loan that has a new interest rate and repayment schedule – this may be your opportunity to acquire a low-interest rate.
It’s important to note, however, that refinancing will cause you to lose access to federal student loan benefits from the CARES Act. To weigh your options and make an informed decision for yourself and your future, contact our debt collection lawyers. We’ve represented countless individuals who have needed support in their debt-related matters.
What to Do If a Debt Collector Comes for Your Paid Student Loans
An issue that many Americans face after paying off their student loans is when debt collectors come demanding proof of payment. If you need to prove that your debt has already been paid, our attorneys can assist you. Agencies that make false claims or harass borrowers deserve to be held responsible. Our team is happy to assess your situation and may take legal action on your behalf.
You Have Questions, We Have Answers
At Atlas Consumer Law, our debt collection and creditor harassment attorneys are results-oriented. When we learn a client’s consumer rights have been violated, we believe justice is in order. We work tirelessly on cases and use our knowledge and experience to achieve optimal results that can include recovered damages, attorney’s fees, and punitive damages. Our team isn’t daunted by the possibility of going up against creditors. We strive to hold the unlawful accountable for their actions – especially when they negatively impact clients. With our help, you can take the first step towards a better future free of debt and harassment.
If you’re being harassed by a creditor, or are unfairly being charged interest on your student loans, call Atlas Consumer Law immediately at (312) 313-1613, or contact us online. You have consumer rights and don’t deserve to be taken advantage of, especially during a time of crisis. No case is too complex for our lawyers to handle.