When Do Student Loans Start Again? Sometime in 2023

Interest RestartsFind Due DateLower PaymentsBottom Line

Interest, payments, and collections on most federal student loans will restart after the forbearance ends on June 30, 2023.

President Joe Biden announced that he was extending the Trump Administration’s pandemic-related pause on student loan repayment until next summer amid legal challenges to his college debt-relief plan. Federal student loan payments, which had been set to start again on Jan. 1, now could be delayed until Sept. 1 as the Biden administration fends off lawsuits over the program.

Borrowers will resume payments 60 days after the court cases are resolved, according to the Education Department. If the matters are still pending by June 30, payments will start 60 days later, i.e., sometime in September.

Private student loans still don’t qualify for any relief benefits.

Biden’s student loan forgiveness application went live last month, and scores of borrowers flooded the Federal Student AidFederal Student Aid (FSA)The office within the U.S. Department of Education that manages federal grants, work-study, and student loans. It runs the FAFSA, the StudentAid.gov website, and oversees the federal loan servicers. website to apply. Almost 26 million people have applied for cancellation so far, and the department has notified over 16 million borrowers that their applications have been approved — pending a decision from the courts.

Before payments resume, the president hopes to defeat the lawsuits blocking his administration from delivering the student loan relief it promised to millions of Americans. If the litigation isn’t resolved by June 30, payments will resume 60 days later. Read more about the latest student loan pause extension.

Ahead, learn more about when federal student loan payments are slated to resume.

Related: ‍ How to Apply for Student Loan Forgiveness

Twitter Embed

I'm confident that our student debt relief plan is legal. But it’s on hold because Republican officials want to block it.

That's why @SecCardona is extending the payment pause to no later than June 30, 2023, giving the Supreme Court time to hear the case in its current term. pic.twitter.com/873CurlHFZ

— President Biden (@POTUS) November 22, 2022

When does student loan interest start again?

Student loan interest is on hold until the forbearance ends, which will be no later than June 30, 2023. Interest will begin to accrue the next day. You can find your interest rate by contacting the student loan servicerLoan ServicerThe company that manages a borrower's federal student loan account, processes payments, and handles applications for repayment plans, deferment, forbearance, and forgiveness on behalf of the U.S. Department of Education. — the company that handles your account.

The White House has said this latest extension will be the last for federal student loan debt.

Here’s a list of federal student loan servicer companies:

• Aidvantage (took over loans held by the Department of Education from Navient)
• Edfinancial Services
• FedLoan Servicing
• Great Lakes
• MOHELA
• Nelnet
• OSLA
• American Education Services has Federal Family Education Loans only.
• Default Resolution Group only handles federal student loans in defaultDefaultThe status of a federal student loan after the borrower has failed to make required payments for 270 days. Default can trigger collection actions such as wage garnishment, tax refund offset, and damage to credit reports..

Related: Student Loan Pause End Date

Twitter Embed

UPDATE: The Administration is extending the pause on federal student loan repayments to allow for the Supreme Court to rule in the case on the student debt relief program.

The pause will end no later than June 30, 2023. Payments will resume 60 days after the pause ends. pic.twitter.com/xTtlqWY3g0

— The White House (@WhiteHouse) November 22, 2022

‍ Not sure who your servicer is? Visit StudentAid.gov, go to your account dashboard, and scroll down to the “My Loan Servicers” section. Keep in mind that more than one company may have your loans. Be sure to locate all of your loans before the resumption of payments, so you don’t risk delinquencyDelinquencyThe status of a loan when a payment is past due but the borrower has not yet defaulted. Federal loans are delinquent from the first day after a missed payment and are typically reported to credit bureaus after 90 days. and harm to your credit score. You can also call the Federal Student Aid Information Center at 1-800-433-3243.

How can I find out my payment amount and due date?

You can find the due date for your first student loan payment by contacting your student loan servicer. Ask the representative the following questions:

• When will my first payment be due?
• What repayment plan am I in?
• What will my payment amount be?
• When can I sign up for autopay?
• What is my student loan account number?*

Learn More: Who Do You Contact If You Have Questions About Repayment Plans?

\* You’ll need this information to claim the interest deduction on your tax return.

How to lower student loan payments when they resume

Some borrowers won’t have trouble making payments when those billing statements start arriving next summer. But for others — recent graduates, parents, borrowers in student loan default, and so on — the payment amount won’t fit their budget, which could force them to make tough choices. Thankfully, the federal government — unlike private lenders — offers its borrowers flexible repayment options to accommodate most situations.

Related: Fresh Start Student Loan Program

Here’s how to lower your student loan payments, depending on your situation.

If you have a financial hardship or recently graduated from college

You can request an affordable payment that’s tied to your income and family size. If you don’t have income or are drawing Social Security benefits, your monthly payment could be zero.

Ask your servicer about enrolling in one of the income-driven repayment plans: IBR, ICR, PAYE, or REPAYERevised Pay As You Earn (REPAYE)A former federal income-driven repayment plan that capped payments at 10% of discretionary income, with forgiveness after 20 or 25 years. REPAYE was replaced by the SAVE Plan in 2023.. You can use the Loan Simulator on the Federal Student Aid website, StudentAid.gov, to estimate your payment amount based on your current pay or your adjusted gross income from your most recent tax return.

If you’re pursuing Public Service Loan ForgivenessPublic Service Loan Forgiveness (PSLF)A federal program that forgives the remaining balance on Direct Loans after 120 qualifying monthly payments made while working full-time for a government or qualifying nonprofit employer.

Make sure you submit a new PSLF Employment Certification form and update your income and family size before the student loan recertification deadline, March 2023. The Education Department is allowing borrowers to self-report their income through July 31, 2022. That means you don’t have to submit a tax return or pay stub when you report your income. If you submit the IDRIncome-Driven Repayment (IDR)A category of federal student loan repayment plans that calculate monthly payments based on income and family size rather than loan balance. Any remaining balance can be forgiven after 20–25 years of qualifying payments. application online, select “I’ll report my own income” when you get to Step 2.

Note: Last October, the Education Department announced it would give retroactive credit toward public service forgiveness to borrowers working full-time for the government or an eligible nonprofit who hadn’t yet had their loans forgiven. To receive credit, borrowers had to apply before the PSLF Waiver ended on October 31, 2022.

The U.S. Department of EducationU.S. Department of Education (ED)The federal agency that oversees federal student aid programs, issues regulations for federal student loans, and is the ultimate lender on Direct Loans. is continuing its work to improve PSLF. A few weeks back, it announced proposed changes to the regulations that would allow more payments to qualify for PSLF and allow some deferments and forbearances to count toward PSLF.

Learn More: PSLF Reddit — What Works and Doesn’t Work

If you have Parent PLUS Loans

Look into changing repayment plans. The Extended or Graduated plans stretch your repayment term over 25 or more years and give you a payment amount that either stays the same or goes up every few years. Those plans are good options if you’re still working and have a high income.

But if you need a lower payment because you’re about to retire or are already drawing Social Security benefits, look into the income-contingent repaymentIncome-Contingent Repayment (ICR)The oldest federal income-driven repayment plan, with payments generally set at 20% of discretionary income or a fixed 12-year amount, whichever is lower. It is the only IDR plan available to Parent PLUS borrowers after consolidation. plan. The ICR plan caps your monthly payment at 20% of your income. You could have a zero-dollar bill if Social Security benefits are your only source of income when the moratorium ends.

Learn More: How to Pay Off Parent Plus Loans

If you have FFEL or Perkins Loans

You can get the benefits other federal student loan borrowers have received throughout the coronavirus pandemic by consolidating your loans into a Direct Consolidation Loan. Consolidation has two main advantages:

• It can give you a lower monthly payment for all your federal student loans.
• It can give you credit towards forgiveness with the PSLF Waiver for a limited time.
• You can also apply payments and past forbearances from consolidated loans towards loan forgiveness through income-driven repayment by taking advantage of the IDR Waiver.

You can consolidate for free at StudentAid.gov.

Learn More:

• Can You Consolidate Student Loans More Than Once?
• Do FFELP Loans Qualify for PSLF?
• Consolidation and Student Loan Forgiveness: Who Qualifies?

Need help with your loans before the freeze ends? Let’s talk.

If you want to go over options for your options before the student loan payment pause ends on June 30, 2023, schedule a phone call with me. I am a student loan lawyer with years of experience helping people find ways to deal with their loans so they can achieve their personal goals: start a family, buy a house, retire, etc.

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