There’s no doubt about it, COVID-19 has greatly impacted the financial status of millions of people across the United States. People from every walk of life are struggling to make ends meet due to unexpected job loss and economic decline. The CARES Act, a $2 trillion stimulus relief bill, provides financial assistance to those individuals facing hardship and is also designed to help stimulate the economy. One of the most prominent factors of the CARES Act is student loan assistance. These are some of the top questions financial institutions receive regarding coronavirus and student loans.
How Does the CARES Act Impact My Student Loans?
In an effort to provide economic relief, the government has temporarily suspended student loan payments on federal student loans. Between March-September 2020, all federal student loans will be automatically placed in forbearance. Borrowers will not need to apply for forbearance and no interest will accrue during that time.
For student loan borrowers, it’s important to understand that not all student loans are eligible for forbearance. Individuals with private student loans will need to inquire with their personal lender about alternative options if they’re having trouble making their payments.
Can I Still Pay My Student Loans?
Some people are very fortunate to still have their jobs in the midst of the pandemic. As the federal relief flows in, these individuals want to know if they’re able to still make payments on their student loans if they want to, and the answer is yes.
If you’re able to keep paying your student loans during this time, it’s in your best interest to do so. Although your loans will not accrue additional interest if you don’t make payments, you will still need to resume those payments in the long-run, which adds lifespan to your loans. Some individuals are also choosing to use their stimulus checks to apply additional payments to their student loan balances to pay them down faster.
Are My Student Loans Forgiven?
Leading up to the 2020 election, there’s been a lot of political discussions about student loan forgiveness. Student loan forgiveness comes in many different forms, including a full dismissal of student loan debt. Many people are asking if the coronavirus stimulus package provides student loan forgiveness. The answer is no.
The stimulus relief package only provides temporary student loan forbearance. A forbearance is an agreement between a lender and a borrower to temporarily suspend payments. If a person was having trouble paying their student loans before coronavirus relief, they will likely face difficulty once they’re required to make payments again in October. Any person who is worried about how they will make their student loan payments long term should consult their lender about alternative payment options. Many lenders offer income-based repayment plans or extended repayment plans that lower the amount of monthly payments.
Consult a Debt Settlement Attorney Regarding Your Student Debt
Student loan debt can be crippling. If you’re struggling to make your student loan payments due to coronavirus or other financial circumstances, there’s no better time than now to take control of your future. A debt settlement attorney can help you negotiate your debts so you can walk away from your loans stress-free.
McCarthy Law PLC is a trusted source of legal representation for debt settlement cases. We are passionate about helping you get back on your feet, improving your credit score, and erasing your debt. Our team is recognized for helping clients just like you achieve debt settlement success. To get started on your way to a debt-free future, schedule a free case review today. Call 855-976-5777 or fill out our online contact form today.
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