Student loan relief extended to 2020 for federal borrowers

Student loan relief for federal borrowers, which began in March 2020 and was scheduled to end on September 30, 2020, has now been extended to December 31, 2020.

President Donald Trump signed a presidential memorandum on August 8, which said it was appropriate to continue the student loan relief enacted under the CARES Act, as many Americans remain financially affected by COVID-19. U.S. Education Secretary Betsy DeVos on Friday called on Federal Student Aid to act on the memorandum.

This action allows the interest rates on federal student loans to stay at zero. Borrowers will continue to have their payments suspended without penalty, although they can continue to make payments if they wish. Student loan forgiveness will not be counted against student loan exemption borrowers. Non-payments during this period will count towards the payments required by the civil service loan forgiveness program.

According to The Institute for Access to and Success in CollegeAlabama borrowers have an average of $ 29,469 in student loans, and 51 percent of its graduates have some sort of debt. 27 percent of the total percentage of student loan debt for graduates is non-federal debt. Alabama borrowers owed $ 22.1 billion in federal debt as of March 31 according to the FSA website. Alabama had 600,000 borrowers with federal student loans. 47,000 borrowers had more than $ 100,000 in loans while 186,600 had less than $ 10,000.

Prior to Trump’s memorandum and DeVos ‘action, Alabama borrowers contacted Senator Doug Jones’ office. A spokesperson said they “often” receive mail about the extension of student loan relief and forgiveness. Many of the demands echoed the provisions of the HEROES bill, which was passed by the House but is still awaiting a decision from the Senate. Jones said in a statement he was prioritizing the next relief plan to extend the freeze on people in financial difficulty and expand the types of higher education loans that would be covered.

“We need to do everything we can to help keep their heads above water right now – especially students who may not be eligible for unemployment assistance,” Jones said in a statement. .

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