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Federal Student Loan Interest Rates Set to 0% AND Option to Suspend Payments

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More Coronavirus Updates

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On March 20, 2020, U.S. Secretary of Education Betsy DeVos announced that the office of Federal Student Aid will be providing student loan relief to millions of borrowers during the Coronavirus pandemic.

Here are the key takeaways from this announcement:

  • All borrowers with federally held student loans will automatically have their interest rates set to 0% for a period of at least 60 days. In addition, each borrower will have the option to suspend their payments for at least two months allowing borrowers to temporarily stop their payments without worrying about accruing interest.
  • All federal student loan servicers will grant an administrative forbearance to any borrower with a federally held loan who requests one. The forbearance will be in effect for a period of at least 60 days, beginning on March 13, 2020. To request this forbearance, borrowers should contact their loan servicer online or by phone.
  • Any borrower more than 31 days delinquent as of March 13, 2020, or who becomes more than 31 days delinquent will be automatically be placed in an administrative forbearance resulting in an automatic suspension of payments, essentially giving borrowers a safety net during the national emergency.
  • If borrowers want to continue making payments, the full amount of their payment will be applied to the principal amount of their loan once all interest accrued prior to the president’s March 13th announcement is paid.
  • Any borrower who has experienced a change in income can contact their loan servicer to discuss lowering their monthly payment.
  • Note that private student loans are not eligible for these benefits.
  • Click here for more information and updates.
Join The Discussion

Comments 41

  1. JJ

    Nicely stated!, I work for doe student loan company and this is exactly what we are doing! 👏🏽😁

    • Amber (Hip Sidekick)

      🙌

  2. Jess

    How do I find out if mine will qualify? I have consolidated subsidized and unsubsized loans held through a commercial lender.

    • kayti

      If it is not a federal loan and was consolidated with another vendor, then you would not qualify.

  3. candace

    Good luck to us who need to get through. I’ve tried two different days to call so far and got the message they had offices closed due to Coronavirus shortage but you have to call to do it :/

    • Miranda L

      Try emailing them.

      • candace

        I did but we’ll see if they’ve set different parameters to allow it. Normally the cant. Has to be over the phone.

  4. Rn404

    My loans are through Nelnet so I will contact them and they are goloud about getting back with you quickly

    • Rischelle

      Some of my loans are through Nelnet as well. Went online yesterday and had no problem requesting the forbearance. They even have a drop down menu that specifically lists Covid-19 Forbearance as an option. My other loans are through AES, which did not have such an option, nor did the forbearance option have the word “administrative” attached to it, so I just did a general forbearance and put all of that information in a comment section. So long as we’re contacting them, they should be backdating everything. Good luck, everyone!

  5. kelly

    If only they just, ya know, voided them altogether. Now THAT would stimulate the economy.

    • tipaye

      Right?

      • mal f

        Will I get paid back for the student loans I have paid back then??

        • gray757

          Umm definitely no

        • sara

          There is an important distinction between 2 kinds of people. Those who think, “I don’t want anyone to suffer like I did.” And those who think “I suffered; why shouldn’t they?”

          • katie

            And then there are those who paid their own way through college without taking a loan and don’t expect other people to pay for their choices.

            • Deal Dawg

              And there are those who have no choice but to get a loan and make payments on time each month to pay it back. For those in that situation, this is a nice break.

    • MommySpendsLess

      Kelly – this appears to be less about stimulating the economy and more about letting people who have lost their jobs or had their hours cut keep their cash on hand for essentials until they can go back to work. Forgiving debt for people who earned degrees, presumably to obtain professional careers, is probably not going to help the economy long term as much as government funded infrastructure projects that would employee some of the thousands who will likely be unemployed by the time this is over.
      And I have student loans that I’ve been paying off for years and I would love for the last few thousand I owe to magically go away but that doesn’t mean I think they should because there’s an economy crippling pandemic.

      • Sushi

        Kelly, you never know. If you google student loan forgiveness, there is a lot of discussion happening. Student loans do indeed cripple consumer spending. However it’s a big moneymaker for the government. With the election, you never know…

      • Sushi

        There are a lot of scenarios that could happen in this pandemic. I only see student loan forgiveness as a plus for all of the Americans. Imagine a professional who hasn’t been given any comfort to know that his medical bills will be covered by his employer once he gets infected and his pay will be reduced to by 1/3 to stay home. Once he returns, it could happen again. After 2 months of student loan suspension, we’ll have to borrow from our 401K to start paying student loans not to mention the amount of medical expenses.

  6. gray757

    I have navient. When I log in online, it’s the same. I see no change. Maybe this hasn’t been put in their system yet?

    • Whitney

      Navient has a post about it when you log in. They said it’ll take a couple of days to be reflected, but will be retroactive back to March 13.

      • Jennifer (Hip Sidekick)

        Thank you for helping, Whitney!

      • gray757

        Ok, I don’t have a note when I log in but thanks!

  7. Karen

    Boo. It’s not worth asking for payment suspension for me. I am in year four of the 10 year public service employment required for loan forgiveness. I qualify for retirement before I qualify for the loan forgiveness, so every month I am not making a qualified payment is one month longer I have to work before I can retire.

    • Karen

      And wow! The 0% interest will not reduce the size of your payment: “Monthly payment amounts will not decrease because of the 0% interest rate. Any payment made during this time will first satisfy any pre-existing unpaid interest, and then the remaining amount will be applied to principal.”

      Are you kidding? That’s supposed to stimulate the economy?

      • Carol

        You’re still responsible for your loan. It just doesn’t accrue interest nor are you required to make payments during this time, thus more money in your pocket.

      • ToriSC

        That comment doesn’t make any sense. It’s a loan just like a mortgage or car loan. It’s not a credit card where the payment fluctuates so it’s 30 years before you pay it off. The payment is set when the loan goes active. Any payments now will go to principal assuming you have been making the proper payments. It will shorten it at the end same as if you pay extra on your mortgage and car.

        • Karen

          I understand My question was how this stimulates the economy when the effect is felt years later.

          • PrincessMom

            They’re allowing you to not make ANY payment for a couple months. If you choose to keep making payments then 100% of those payments goes toward the principal.

    • ampurand

      I am on my second year of PSLF. It is helpful for me. The break in payments doesn’t count against me, since they don’t have to be consecutive, so I have a little bit of extra money in this hard time. It does extend my work time before forgiveness by a few months, but I need the money more now than I foresee needing it then.

  8. Lisa

    Please don’t make this a political post. Thank you, H2S, for breaking this down.

    • Penny

      Thank you, President Trump!
      It’s not political I’m just thanking my president for looking after us. After all, that is why we elected him! And that’s what he’s doing.

  9. tipaye

    H2S, please consider removing this comment.

  10. Rebecca

    How do we suspend for 2 months, contact them? Not seeing an option.

  11. De

    Why should student loans be discharged? It’s a debt that you took on. If loans are forgiven then we the taxpayers end up with that burden. I went to school, worked and paid for my own schooling. That being said, in these times the payment should be postponed if necessary.

    • Karen

      No one is saying they do not think they owe a debt. The article indicates there would be 0% interest for two months on federal loans. I would save me $200, a pittance in the face of billion dollar corporate bailouts. Nonetheless, not paying interest on this month’s payment would mean my my son could eat a few days longer. Have soem empathy.

      • De

        I believe Kelly and Tipaye above were commenting on voiding them.

  12. hope-0

    Listen folks who are complaining. Check your entitlement and selfishness. This us supposed to help people who have lost their jobs and/or working hours. You should have thought before you rushed to judge.

    • Amanda7141

      Amen to that! 💕

    • Sushi

      When my entitled and selfishness self looked online, we have to be approved by providing a reason to get our loan suspended. We’re lucky to be working, but have no side hustle/extra money. So, although it would ease my money stress levels due to the coronavirus, our situation doesn’t qualify for the student loan suspension.

  13. cindy

    During normal times, when making a payment there is a selection to not advance due date. So after several payments by leaving that box unchecked, the due date is now in 2021. Does that mean that a payment would not be due until then, with interest accruing of course.

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