The Department of Education (ED) on Friday officially announced that student loan borrowers’ federal loan payments, as a part of President Donald Trump’s recent executive order, will be automatically paused through December 2020, interest free, with no opt-in request needed.
Collections on defaulted loans will also remain halted until 2021, and non-payments will count toward Public Service Loan Forgiveness (PSLF) and income-driven repayment (IDR) progress, the department noted in a press release. Borrowers wishing to continue making payments during the suspension period will still be able to do so.
Federal Student Aid (FSA) is “working in partnership with its student loan servicers to notify borrowers of this extension of loan relief measures, and this outreach effort will continue through the fall and toward an eventual return to repayment,” the announcement reads. “FSA’s servicers are working to make these changes, and borrowers can expect to see this extension reflected in their accounts over the next several weeks.”
The notice from ED addresses some of the questions regarding implementation of the executive order, clearing up confusion regarding PSLF and IDR progress, though the timing could create an obstacle as some borrowers were already receiving notices from their loan servicers saying their payments are scheduled to resume at the end of September.