On March 27, 2020, the president signed the CARES Act into law, which, among other things, provides broad relief for federal student loan borrowers. Below we have answered questions about several provisions of the Act. Questions that have been added or updated are identified with “NEW” or “UPDATED” before each question.
If you’re concerned about your studies or loan repayment, we can help you understand what to do in certain circumstances. We’ll be adding information for students, borrowers, and parents to this page on a regular basis, so please check back frequently.
Your payments will automatically stop from March 13, 2020, through Sept. 30, 2020.
To provide relief to student loan borrowers during the COVID-19 national emergency, federal student loan borrowers are automatically being placed in an administrative forbearance, which allows you to temporarily stop making your monthly loan payment. This suspension of payments will last until Sept. 30, 2020, but you can still make payments if you choose. Read the borrower Q&As below to learn more.
What if my campus has closed due to the coronavirus? Will I be able to finish the term and keep my federal student aid?
Please contact your school. Many institutions are making arrangements (such as take-home assignments or online classes) so students can complete the term.
If my campus is closed or offering only online instruction, will I still get paid for the hours I am unable to work for my Federal Work-Study job?
If you’re unable to work your scheduled hours because of coronavirus-related disruptions (such as school or employer closures or student quarantines), your school may pay you for any scheduled hours or allow you to work by another means—for example, completing work online or remotely, depending on the job. Contact your school for more information.
My parents can't go to their jobs because of the coronavirus, and they don’t get paid if they don’t work. Their unemployment means my financial need has increased. Can I get more financial aid?
Talk to the financial aid office at your school. They have flexibility to work with students to ensure the students are able to stay in school.
Someone in my family has the coronavirus, so our whole family has self-quarantined, and I can't attend classes. How can I keep up in school, so I don't fail classes and lose my financial aid?
We encourage you to contact your school’s financial aid office, as well as your academic advisor/coach or program coordinator, for additional guidance about your financial aid situation. Your school can tell you your options for continuing in your program of study. Additionally, if you need to take a leave of absence as a result of the coronavirus outbreak, you should speak with your school’s financial aid office.
Many schools have provided detailed coronavirus-related decisions and guidance for students. We encourage you to check your school’s website and verified social media accounts for resources and the latest information about this rapidly evolving situation.
If my school moves classes online, am I going to get less financial aid?
If your school has moved classes to an online format, you must continue to participate in the course work and follow your teacher’s or professor’s instructions to remain eligible for financial aid. If you have questions about the online format, contact your school.
How do I contact my school’s financial aid office if the school is closed?
Check your school’s website for resources and contact information. Your school’s verified social media accounts also may be a good source for the latest information about how to contact your school during this time. While many schools have transitioned face-to-face courses to online instruction, most remain open and available to assist their students with questions.
UPDATED: Interest is being temporarily set at 0% on federal student loans. Which loans does the 0% rate apply to?
From March 13, 2020, through Sept. 30, 2020, the interest rate is 0% on the following types of federal student loans owned by ED:
Please note that some FFEL Program loans are owned by commercial lenders, and some Perkins Loans are owned by the institution you attended. These loans are not eligible for this benefit at this time.
How can I take advantage of this 0% interest period if I have Federal Family Education Loan (FFEL) Program and Federal Perkins loans not owned by ED?
While your lender or school can provide these benefits should it choose to do so, you can consolidate your FFEL Program or Federal Perkins loans not owned by ED into a Direct Consolidation Loan, which would be eligible for 0% interest. However, if you consolidate, after the 0% interest rate period ends, the interest rate on your loan may be higher than what you are currently paying. In addition, when you consolidate, any outstanding interest will capitalize, meaning that any outstanding interest is added to your principal balance. Your servicer can provide you with information about how your loan balance, interest rate, and total amount to be paid would change if you consolidated into a Direct Consolidation Loan.
Who can tell me if my loans will have their interest rate temporarily reduced to 0%?
Contact your loan servicer online or by phone to determine if your loans are eligible. Your servicer is the entity to which you make your monthly payment. If you do not know who your servicer is or how to contact them, visit StudentAid.gov/login or call us at 1-800-4-FED-AID (1-800-433-3243; TTY for the deaf or hearing-impaired 1-800-730-8913) for assistance.
If my loans are owned by ED, do I need to do anything for the interest on my loans to be set at 0%?
No, ED will automatically adjust your account so that interest doesn’t accrue (i.e., accumulate). The account adjustment will be effective March 13, 2020.
UPDATED: If I make loan payments during the 0% interest period, how will they be applied?
During the period of 0% interest (March 13, 2020, through Sept. 30, 2020), the full amount of your payments will be applied to principal once all the interest that accrued prior to March 13 is paid.
UPDATED: Are private student loans eligible for the 0% interest benefit?
No. ED does not have legal authority over private student loans, and they are not covered by the CARES Act.
UPDATED: I understand that my loans will be placed in administrative forbearance, temporarily suspending my monthly payments. How long will the administrative forbearance last?
The administrative forbearance will last from March 13, 2020, through Sept. 30, 2020.
NEW: If I’m currently in an income-driven repayment (IDR) plan, will my suspended payments count toward IDR forgiveness?
NEW: Will suspended payments count toward Public Service Loan Forgiveness (PSLF)?
If you have a Direct Loan, were on a qualifying repayment plan prior to the suspension, and work full-time for a qualifying employer during the suspension, then you will receive credit toward PSLF for the period of suspension as though you made on-time monthly payments.
NEW: What will happen to my regular auto-debit payments if I do nothing?
Auto-debit payments are suspended during the administrative forbearance. Any auto-debit payments processed between March 13, 2020, and Sept. 30, 2020, can be refunded to you. Contact your loan servicer to request that your payment be refunded.
If you don’t want an administrative forbearance and want to continue making payments, contact your loan servicer to opt out of the administrative forbearance, and your auto-debit payments will resume.
You also have the option to remain in the administrative forbearance and make manual (i.e., not auto-debit) payments during the administrative forbearance period. Visit your loan servicer’s website to make a payment, or contact your loan servicer for more information.
NEW: If I made a payment after the president signed the CARES Act on March 27, 2020, can I receive a refund?
Yes; any payment you made during the administrative forbearance period (March 13, 2020, through Sept. 30, 2020) can be refunded. Contact your loan servicer to request that your payment be refunded.
NEW: If I’m trying to rehabilitate my defaulted student loan, will my suspended payments count toward my rehabilitation?
UPDATED: How will I know when I will have to start making payments again?
The 0% interest period and administrative forbearance is currently set to expire on Sept. 30, 2020. Your servicer will contact you, no later than in August, to remind you that you will need to start making payments again. Make sure your contact information is up to date in your loan servicer account profile.
UPDATED: What if I want to continue making payments?
If you wish to continue paying your loans during the administrative forbearance period, or to pay more or less than your regular payment amount, you are free to do so. Contact your loan servicer or visit your servicer’s website to make a payment or to find out how you can continue or start auto-debit payments. Continuing to make payments during the administrative forbearance could help you pay down your loan balance more quickly because the full amount of a payment will be applied to principal once all interest accrued prior to March 13, 2020, is paid.
If you continue making regular payments but then experience a change in income, please contact your loan servicer as soon as possible to discuss options, such as enrolling in an income-driven repayment plan to lower your payments or opting in to the administrative forbearance that ends Sept. 30, 2020.
What if I want to continue making a partial payment while my loan is in forbearance?
As long as you are in forbearance, you will not be penalized for making a payment that is less than your usual monthly payment. Meanwhile, you still have the option to make a payment on your loan to make progress toward reducing your balance. Contact your loan servicer or visit your servicer’s website to make a payment or to find out how you can continue or start auto-debit payments.