Emergency Relief For Federal Student Loans

If you’re struggling with federal student loan debt, you may be able to get emergency relief.

In some cases, you may be eligible for an income-driven repayment plan (IDR). These plans lower your monthly payment by extending the length of your repayment term and reducing your monthly payment amount.

In addition to IDR, there are other options for getting help with your loans:

• Payment forbearance—your lender agrees to temporarily stop collecting payments on your loan; this should only be used when other options aren’t available.

• Loan rehabilitation—your lender agrees to forgive any remaining balance on your loan if you make nine consecutive payments on time; you can also qualify for a reduced interest rate after making four consecutive payments on time.

Emergency Relief For Federal Student Loans

Finding relief for student loan debt becomes even more pressing if you’re one of the millions who lost their job or earn less because of the pandemic. Here’s some good news: It’s easier than ever to get payment relief for student debt right now, no matter what type of loan you have. In this article, we explain the different programs available, who qualifies, and how you can benefit from them.


  • The U.S. federal government’s CARES Act gives borrowers forbearance.
  • Under the law, loans don’t accrue interest, payments aren’t required, and there are no late fees, among other provisions.
  • Your wages, tax refund, and Social Security payments can’t be garnished if you’re behind on a federal student loan.
  • Borrowers who need relief on private student loans or commercial student loans may be eligible, but it isn’t as straightforward.
  • During pandemic-related forbearance, debt collectors may not try to collect payments on federal student loans.

Automatic Federal Student Loan Forbearance

The Coronavirus Aid, Relief and Economic Security (CARES) Act grants federal student loan borrowers automatic administrative forbearance if the U.S. Department of Education owns the loans. What does this mean?

Originally passed on March 13, 2020, the White House extended student loan forbearance through Aug. 31, 2022.1 This includes all defaulted loans in the Federal Family Education Loan Program.2 As such:

  • Your interest rate will drop to 0%.
  • You don’t have to make payments.
  • You can continue to make full or partial payments during this time if you choose to do so.
  • You won’t be charged any late fees.
  • Interest stops accruing.
  • The interest you owed on March 12, 2020, will not be added to your principal balance.
  • You don’t have to contact your loan servicer to request these benefits if you’re eligible for them.

When you log in to your student loan account or look at your student loan statement, it should show an interest rate of 0% if you receive the benefit. If your rate is not 0%, double-check that your servicer didn’t make a mistake. Here’s how to determine if you should be getting this rate.

The American Rescue Plan, passed by Congress and signed by President Biden in March 2021, includes a provision that student loan forgiveness issued between Jan. 1, 2021, and Dec. 31, 2025, will not be taxable to the recipient.4

how to apply for cares act student loan forgiveness

If you have a student loan owned by the U.S. Department of Education, the government has granted you automatic forbearance on this loan under the Coronavirus Aid, Relief, and Economic Security (CARES) Act. On April 6, 2022, the Biden administration extended the forbearance period, allowing loans to stay in forbearance through Aug. 31, 2022.1617

Between March 13, 2020, and Aug. 31, 2022, no interest will accrue, and you don’t need to make any payments. No late fees will apply if you stop paying during this period. You’ll know you have this benefit if you see a 0% interest rate when you log in to your student loan account.18 On March 30, 2021, the Department of Education extended this benefit to defaulted privately held loans under the Federal Family Education Loan (FFEL) Program.19

Under normal circumstances, you can’t make progress toward loan forgiveness during forbearance. But under the CARES Act, you can. You’ll receive credit toward income-driven repayment forgiveness or public service loan forgiveness for the payments you normally would have made during this period

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