The Student Loan Forbearance under the CARES Act has been extended again. The forbearance was due to expire on September 30, 2021; however, it has been continued until January 31, 2022.
FEDERAL STUDENT LOAN FORBEARANCE
The CARES Act placed all Federal student loan borrowers in an administrative forbearance. Federal student loan payments are not due during the forbearance, and no interest accrues during this period. The Federal Student Loan Forbearance is automatic. The borrower does not have to request the forbearance.
The forbearance applies to government loans whether current or in default. The following are common Federal government loans:
- DIRECT Loans
- FFEL Loans
- Federal Perkins Loans
- HEAL Loans
Please note the automatic forbearance does NOT APPLY to private student loans.
INCOME DRIVEN REPAYMENT PROGRAMS and PUBLIC SERVICE LOAN FORGIVENESS
Student loan borrowers participating in Income Driven Repayment programs are also placed in automatic forbearance. The suspended payments count towards the IDR’s total payments. Similarly, student loan borrowers participating in Public Service Loan Forgiveness program are placed in automatic forbearance. And, the suspended payments count towards the 120 monthly payments required under such program.
OPT OUT OF AUTOMATIC FORBEARANCE
You may opt out of the automatic forbearance. Any payments, full or partial, made during the forbearance period apply to principal! As such, you can pay down your loans during the forbearance period.
