Student Loans Benefit from CARES Act

by | May 1, 2020 | Wealth Management

  • Federal student loans have all payments suspended until September 30th
  • During this time, the loans will not accrue interest
  • Most collection efforts for student loans will cease during this time

What do you need to do?

The short answer is nothing. During this time review with your provider if you have auto payment set up to ensure these don’t continue

Do all student loans qualify?

Unfortunately, no. Only direct student loans and Federal Family Education Loans (FFELs) benefit. Private student loans or FFEL loans not owned by the government do not qualify.

Although these non-government owned FFELs and Perkins loans may not qualify for payment relief, they could potentially be consolidated into a direct loan that would qualify for no payments!

Public Service Loan Forgiveness

The time during this payment free period still count towards qualifying for loan forgiveness programs.

What about student loans in collection or have garnishment?

The CARES Act suspends all collection efforts including garnishment of wages or seizures of Social Security benefits.

What if I want to continue to make payments?

If you can afford to then please continue making payments. However, this is a great opportunity to pay down higher interest rate debt during this time.

If you would like to learn more about how this impacts you personally please do not hesitate to contact us!

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