topic Re: Student Loan Forbearance continuation after January in Student Loans

Student Loan Forbearance continuation after January

calyx — Mon, 11 Jan 2021 15:40:50 GMT

Good news MyFicoers,

It appears that one of the new administration's first orders will be to extend the payment pause and 0% interest:

https://www.marketwatch.com/story/biden-administration-to-extend-student-loan-payment-pause-on-day-one-transition-officials-say-11610149940

Re: Student Loan Forbearance continuation after January

Anonymous — Mon, 11 Jan 2021 21:47:41 GMT

@calyx wrote:
Good news MyFicoers,

It appears that one of the new administration's first orders will be to extend the payment pause and 0% interest:

https://www.marketwatch.com/story/biden-administration-to-extend-student-loan-payment-pause-on-day-one-transition-officials-say-11610149940

This is good news. However, nothing is finalized. We won't know until later this month..

Re: Student Loan Forbearance continuation after January

PullingMeSoftly — Mon, 11 Jan 2021 21:48:44 GMT

Thanks for the article @calyx , I was just about to start looking for news on this front. Seems hopeful as a day 1 item, but I won't believe it until the Dept of Ed actually receives the marching orders. I've got exactly 1 year to go for PSLF discharge, so I am eagerly awaiting an update.

Re: Student Loan Forbearance continuation after January

ccquest — Tue, 12 Jan 2021 02:06:29 GMT

I was pretty much taking it as a given that the 0% period would continue, but happy to see it a little more tangibly. Question now is just, how long?

I'm really hoping they can push through the plan as he has it now for the PSLF changes - specifically the "up to five years of prior national or community service will also qualify [ ... for ... ] $10,000 of undergraduate or graduate student debt relief for every year of national or community service". That right there would wipe out a large majority my federal loans (75%) and put me in a much better place financially as I've got 4 years of repayment so far, 6.5 years of service.

Re: Student Loan Forbearance continuation after January

calyx — Tue, 12 Jan 2021 20:28:52 GMT

@ccquest wrote:
I was pretty much taking it as a given that the 0% period would continue, but happy to see it a little more tangibly. Question now is just, how long?

I'm really hoping they can push through the plan as he has it now for the PSLF changes - specifically the "up to five years of prior national or community service will also qualify [ ... for ... ] $10,000 of undergraduate or graduate student debt relief for every year of national or community service". That right there would wipe out a large majority my federal loans (75%) and put me in a much better place financially as I've got 4 years of repayment so far, 6.5 years of service.

^ I would be thrilled for people if this happens (for other people - I would have qualified if I'd known about it in the past, though I don't now.)
I would also be thrilled with the blanket 10k they're talking about. I borrowed 22k. I've paid back 56k. I still have 15k to go. UGH. BUT, I would still cheer any relief to anyone, even if I don't qualify.

Re: Student Loan Forbearance continuation after January

ccquest — Tue, 12 Jan 2021 22:31:47 GMT

I wonder if that 10k for everyone would stack on top of the PSLF numbers. In 14 months, I will have completed 5 years of service. My total balance right now sits at $63k including interest. If it stacks, I would get $10k immediate relief, then $50k worth for 5 years of service at $10k each and would be left with $3k. At that point, I'd pay it off in full and be done with it for sure.

And once those are gone, I'm certain I'd qualify for better rates on refinancing my private loans too!

Re: Student Loan Forbearance continuation after January

Anonymous — Wed, 13 Jan 2021 08:29:52 GMT

@calyx wrote:
@ccquest wrote:
I was pretty much taking it as a given that the 0% period would continue, but happy to see it a little more tangibly. Question now is just, how long?

I'm really hoping they can push through the plan as he has it now for the PSLF changes - specifically the "up to five years of prior national or community service will also qualify [ ... for ... ] $10,000 of undergraduate or graduate student debt relief for every year of national or community service". That right there would wipe out a large majority my federal loans (75%) and put me in a much better place financially as I've got 4 years of repayment so far, 6.5 years of service.
^ I would be thrilled for people if this happens (for other people - I would have qualified if I'd known about it in the past, though I don't now.)
I would also be thrilled with the blanket 10k they're talking about. I borrowed 22k. I've paid back 56k. I still have 15k to go. UGH. BUT, I would still cheer any relief to anyone, even if I don't qualify.

@calyx , this also pains me regarding PSLF. I worked non-profit for 15 years! Instead of continually deferring and eventually defaulting on my SLs, I could have had my SLs forgiven (ehem ...also while doing IBR, which I never knew existed as an option until after the fact/it was too late, hence my throwing in the towel), but alas, once I finally found out about it....I had already left the non-profit and went for-profit. I would be thrilled to take at least the retroactive 5 years / 50k! That would cover at least 1/3 of my SLs argh!

Re: Student Loan Forbearance continuation after January

calyx — Wed, 13 Jan 2021 13:54:51 GMT

@Anonymous wrote:
@calyx wrote:
@ccquest wrote:
I was pretty much taking it as a given that the 0% period would continue, but happy to see it a little more tangibly. Question now is just, how long?

I'm really hoping they can push through the plan as he has it now for the PSLF changes - specifically the "up to five years of prior national or community service will also qualify [ ... for ... ] $10,000 of undergraduate or graduate student debt relief for every year of national or community service". That right there would wipe out a large majority my federal loans (75%) and put me in a much better place financially as I've got 4 years of repayment so far, 6.5 years of service.
^ I would be thrilled for people if this happens (for other people - I would have qualified if I'd known about it in the past, though I don't now.)
I would also be thrilled with the blanket 10k they're talking about. I borrowed 22k. I've paid back 56k. I still have 15k to go. UGH. BUT, I would still cheer any relief to anyone, even if I don't qualify.
@calyx , this also pains me regarding PSLF. I worked non-profit for 15 years! Instead of continually deferring and eventually defaulting on my SLs, I could have had my SLs forgiven (ehem ...also while doing IBR, which I never knew existed as an option until after the fact/it was too late, hence my throwing in the towel), but alas, once I finally found out about it....I had already left the non-profit and went for-profit. I would be thrilled to take at least the retroactive 5 years / 50k! That would cover at least 1/3 of my SLs argh!

@Anonymous - Public sector for 18 years!!!!
I mean, I currently work for a nonprofit, I think (my employment is a little weird because I work for an org made of multiple orgs, so I get my paycheck from different orgs at different times).

Re: Student Loan Forbearance continuation after January

ccquest — Thu, 21 Jan 2021 04:04:03 GMT

Official WhiteHouse.gov page:

At the request of President Biden, the Acting Secretary of Education will extend the pause on federal student loan payments and collections and keep the interest rate at 0%. Too many Americans are struggling to pay for basic necessities and to provide for their families. They should not be forced to choose between paying their student loans and putting food on the table.

CNN article that says 9/31 at least, this does coincide with the fiscal year for the government so it's *possible* it could go beyond that, but this is definitely a good start for us.

The other executive actions he's taken on day one.

Re: Student Loan Forbearance continuation after January

Anonymous — Thu, 21 Jan 2021 04:10:56 GMT

@ccquest wrote:
Official WhiteHouse.gov page:

At the request of President Biden, the Acting Secretary of Education will extend the pause on federal student loan payments and collections and keep the interest rate at 0%. Too many Americans are struggling to pay for basic necessities and to provide for their families. They should not be forced to choose between paying their student loans and putting food on the table.
CNN article that says 9/31 at least, this does coincide with the fiscal year for the government so it's *possible* it could go beyond that, but this is definitely a good start for us.

The other executive actions he's taken on day one.

I noticed this on NSLD website when I was seeing if there were any updates on my accts.

It didn't go into detail, so does this mean the same going forward? No payments due until 9/31, 0% interest, holding off on collection action for defaulted SLs (along with no wage garnishment/tax confiscation)?

Re: Student Loan Forbearance continuation after January

ccquest — Thu, 21 Jan 2021 04:19:17 GMT

Definitely seems that way! It says to extend so I'm expecting another 8 months of what we've been getting which is music to my ears like I've already been saying. Just based on monthly payments alone, this will have saved me at least $5k and moved me "forward" 19 months (sheesh that's a long time dealing with COVID) for payment progress.

Re: Student Loan Forbearance continuation after January

Anonymous — Thu, 21 Jan 2021 04:29:47 GMT

@ccquest wrote:
Definitely seems that way! It says to extend so I'm expecting another 8 months of what we've been getting which is music to my ears like I've already been saying. Just based on monthly payments alone, this will have saved me at least $5k and moved me "forward" 19 months (sheesh that's a long time dealing with COVID) for payment progress.

That is awesome! I am so glad this is a help to you!

I have privately serviced FFELs that I just got out of rehab (2 different servicers/sets) so they do not fall under this blanket, unfortunately. I have considered consolidating them with my Fed Loans, but those are the only one's that I haven't been able to rehab yet, so I cannot consolidate them for the time being.

My Fed Loans age off my credit reports in Aug/Sept (as early as March with EE), so it will lower my DTI. I plan on holding off setting up rehab until Sept if defaulted SLs are in fact still being handled the same.

This means that until rehab is completed they will remain off my reports, so I want to extend that out as long as possible. All while I start chipping away at the privately serviced FFELs. It will give me some breathing room if I can pay down/off a couple of those loans before I have to also start paying on set #3 and in the meantime reduce my DTI a little before they start reporting again (an extra 18-19 months).

Re: Student Loan Forbearance continuation after January

calyx — Fri, 22 Jan 2021 14:53:57 GMT

I came here to report the 9/31 extension - I saw it both on the Dept. of Ed site and Fedloan! Woot woot.

I know some people were hoping for debt forgiveness, but Biden had said repeatedly that he wanted any forgiveness to go through Congress, so I just expected, and am happy with the pause, and that it was for a longer stretch (that they won't have to reevaluate every couple of months as we hold our breaths )

My loan was transferred from Cornerstone to Fedloan, and while my account is accurate, there has been no reporting from Fedloan to the CRAs. Do we think this is from the "pause" (why report when there's nothing TO report). I'm mostly curious just because it's one less installment, and I just like having my profile "anchored" with my installments while I do the credit thing (particularly since I'm going to be posting absurd balances for the next couple of months on one of my cards)

Re: Student Loan Forbearance continuation after January

ccquest — Fri, 22 Jan 2021 16:04:22 GMT

@calyx do you have a thread where you go over the transfer process? I've got a few questions on it and I'm wondering how long it took, if you did it during this pause, if "payments" are reflecting properly or if that's still undetermined. I don't want to miss any "free" months for PSLF if I can help it!

Re: Student Loan Forbearance continuation after January

Cjaysmom — Fri, 22 Jan 2021 18:00:51 GMT

@calyx wrote:
I came here to report the 9/31 extension - I saw it both on the Dept. of Ed site and Fedloan! Woot woot.

I know some people were hoping for debt forgiveness, but Biden had said repeatedly that he wanted any forgiveness to go through Congress, so I just expected, and am happy with the pause, and that it was for a longer stretch (that they won't have to reevaluate every couple of months as we hold our breaths )

My loan was transferred from Cornerstone to Fedloan, and while my account is accurate, there has been no reporting from Fedloan to the CRAs. Do we think this is from the "pause" (why report when there's nothing TO report). I'm mostly curious just because it's one less installment, and I just like having my profile "anchored" with my installments while I do the credit thing (particularly since I'm going to be posting absurd balances for the next couple of months on one of my cards)

I've been paying down my principal throughout the pause. And Navient, my servicer, has reported to the CRAs each month.

Re: Student Loan Forbearance continuation after January

calyx — Fri, 22 Jan 2021 18:27:52 GMT

@ccquest wrote:
@calyxdo you have a thread where you go over the transfer process? I've got a few questions on it and I'm wondering how long it took, if you did it during this pause, if "payments" are reflecting properly or if that's still undetermined. I don't want to miss any "free" months for PSLF if I can help it!

@ccquest - The transfer happened automatically. I don't have a timeline on it (per se), though I do have the letters at home. I knew Cornerstone had cancelled their contract, so it wasn't unexpected. I got a letter from Cornerstone saying that my loan would be transferred to FedLoan. I also got a letter from FedLoan and Dept of Ed about the transfer.

I was able to make an account at FedLoan, I see the loan there (current and correct - I've had PHEAA in the past and trust them as far as I can kick a Ford), and that's it. The process seemed to be pretty smooth, if a bit slow (I was happy for the pause, because it meant that I wouldn't get caught in a nonpayment mistake).

Cornerstone uses the same software as FedLoan for the consumer facing end, so everything looks identical.
And I also got a letter some time ago about resuming payments in February - I checked and even the banking/automatic debit information transferred correctly.

I think all in all, it took 2-3 months? Cornerstone reported closed in November. An open loan has not been reported by FedLoan.

Here is the thread about Cornerstone/FedLoan started by @ChemE_Bear with our discussion about it:
https://ficoforums.myfico.com/t5/Student-Loans/Cornerstone-to-FedLoan-Servicer/m-p/6186498#M26797

Re: Student Loan Forbearance continuation after January

calyx — Fri, 22 Jan 2021 18:26:06 GMT

@Cjaysmom - My Cornerstone loan was reporting each month, but it was closed and I'm asking about a new loan. I have not been paying it down, which is why I am guessing there's no "reason" to be.

Re: Student Loan Forbearance continuation after January

Anonymous — Fri, 22 Jan 2021 20:45:48 GMT

@calyx , so I am wondering if any of my FFELs are even under this benefit.

Now that my loans are transferred, NMSL shows an interest rate, and payment is due 2/4, but I assumed they would play hardball, as they previously stated they would only participate if given no choice.

But Navient, I expected to be going to be on board, but when I login, my account shows an interest rate (and in red underneath it "interest rate set by congress"?) and, as I mentioned previously, a due date of 2/22. That is when the first payment was supposed to be due before the extension, but coincidentally that is exact due date of my rehab payments (the 22nd), so I am uncertain if that means it will be part of this extension or not - I am guessing not since it shows an interest rate with a balance that climbs daily on the "payoff" amounts.

This is a real bummer as my set of SLs with US Dept of ED are still in default. So this does nothing for me other than allow me to postpone hashing out a rehab arrangement with them until Sept so I can focus on paying down some of these other loans (~$90k worth), no matter how small the sent may be it will be more than if I also have to make payments on another ~$40k in SLs.

TL;DR

Anyone with Navient have FFELs/FFELPs that have an interest rate and due date of 2/22 (or a different date, if mine is a fluke) or does it show 0% for interest and a 9/31 due date?

Re: Student Loan Forbearance continuation after January

calyx — Fri, 22 Jan 2021 21:01:26 GMT

@Anonymous- it looks like (according to the dept of ed's website - https://studentaid.gov/announcements-events/coronavirus) that FFELs may not take part in it, so yeah, it's going to be servicer/loan owner dependent, which sucks. I guess I'm grateful for my consolidation, after all.

While your lender or school can provide these benefits should it choose to do so, you can consolidate your FFEL Program or Federal Perkins loans not owned by ED into a Direct Consolidation Loan, which would be eligible for 0% interest. However, if you consolidate, after the 0% interest rate period ends, the interest rate on your loan may be higher than what you are currently paying. In addition, when you consolidate, any outstanding interest will capitalize, meaning that any outstanding interest is added to your principal balance. Your servicer can provide you with information about how your loan balance, interest rate, and total amount to be paid would change if you consolidated into a Direct Consolidation Loan.

Re: Student Loan Forbearance continuation after January

Anonymous — Fri, 22 Jan 2021 21:26:49 GMT

@calyx , thanks, as I feared!

I would have considered consolidating, but since they are defaulted, no dice. If I signed up for rehab right now, I would finisb in Sept and no earlier than October would I be able to consolidate. So pointless considering all the variables. It would be a new TL with no benefit other than a new account ding. I will just stick with my plan to power pay what I can and since collecting on defaulted SLs will be on the back burner til the end of Sept, I will hold off on setting that up until the 11th hour. That gives me 18-19 months to work on my current loans.

Thanks again for the info!