Watching Your Wallet: student loan repayments
If someone with student loans loses a job or gets furloughed, repaying them can be difficult.
There are several options, whether through the federal government or a lender. Some of the help is already happening, but for others, it's up to them to reach out and get the process started.
The financial website Nerdwallet has compiled a list of resources for every kind of loan.
With federal loans, there is an automatic forbearance until September 30th.
The fed is also waiving all interest during this time and has stopped collections for loans in default. But the forbearance will add six months to end of a loan term.
Those who will have trouble repaying loans in the long term can apply for an income driven repayment plan.
This takes into account monthly bills, current income and family size. It then determines what can reasonably be paid.
A private lender will typically let people pause payments for up to 12 months, but interest will accrue during this time.
Some lenders are offering other relief programs; contact them to see what's available.
There’s also the possibility of refinancing. Rates are extremely low right now and some might qualify for a better one.
Check in with the school. The Department of Education is distributing more than $6 billion in emergency cash grants for students in need.
This money can go towards housing, food, books, technology, even childcare. Financial aid offices will have the details.
If employers were helping to pay tuition, the stimulus bill changed the tax code so taxes aren’t owed on those funds for the rest of the year.