Thursday, April 2, 2020
Congress passed the Coronavirus Aid, Relief, and Economic Security (CARES) Act last week to provide relief from many of the hardships created by the coronavirus and President Trump signed the bill into law Friday night. One of the many benefits of the Act was that it, for many borrowers, suspends their student loan payments—interest free—through September 30, 2020.
There is some confusion, however, because it does take time for legislation to be implemented. The CARES Act provides automatic suspension of payments, with 0% interest, and counts towards loan forgiveness, but the website that oversees the majority of government student loans - MyFedLoan - is displaying a message stating an optional suspension of payments that will not count towards forgiveness programs. The website's call centers have decreased staff because of the virus and limited ability to answer borrowers' questions.
Student loan borrowers should be patient, as loan servicers are working to implement the bill and it will be applied retroactively. The Department of Education echoed this message on a call yesterday where it told listeners it is directing loan servicers to make this retroactive to March 13th. So as long as the borrower would have otherwise qualified for a forgiveness program, these months of non-payment will count toward their required number of payments for forgiveness.
See Wesley Whistle, The CARES Act Helps Most Student Borrowers Seeking Loan Forgiveness, Forbes, April 1, 2020.
Special thanks to Jim Hillhouse (Professional Legal Marketing (PLM, Inc.)) for bringing this article to my attention.