Student Loan Payment Pause

On Friday, March 27, 2020, Congress and President Trump passed the CARES Act [Coronavirus Aid, Relief, and Economic Security Act], and millions of student loan borrowers gained a temporary reprieve from making payments until September 30, 2020. Additionally, as President Trump promised two weeks ago, student loan interest is also waived until September 30, 2020.

Mark Kantrowitz of, recommends:

If your federal student loans are eligible, you do not need to do anything to pause the payments on your eligible loans. The payment pause and interest waiver will be automatic. You do not need to apply for the payment pause. However, you should login to your student loan account to confirm that interest has stopped accruing on your student loans.

Forbes, March 28, 2020

The following are the types of loans eligible for the suspending payments and interest waiver:

Federal Direct Stafford Loans, Federal Direct Parent PLUS Loans, Federal Direct Grad PLUS Loans, and Federal Direct Consolidation Loans are eligible for the payment pause and interest waiver.

Forbes, March 28, 2020

No private loans qualify for the “payment pause” or interest waiver. Additionally, Federal Family Education Loan Program (FFELP), also known as “guarenteed loans” are not automatically eligible for the interest waiver or pause in payments, so borrowers should contact their loan servicer for more details.

Basically, the “payment pause” simply freezes student loan balances at the current amount, and borrowers aren’t obligated to make any payments until October 1, 2020.

Additionally, for any borrowers seeking loan forgiveness through programs, like Public Service Loan Forgiveness (PSLF), these six months of suspended payments will count toward the 120 total payments needed to qualify for PSLF.

For borrowers in the fiscal position to continue making payments, can do so, paying down more principal, so when interest does begin accruing again on October 1, 2020, the total interest repaid over the life of the loan will be reduced, saving money.

While the six month reprieve may free cash flow temporarily, especially for individuals who are not working or have a reduced salary during the extraordinary crisis of the global pandemic, as a society, we’ve simply postponed dealing with the $1.6 Trillion total student loan debt problem. Total student debt is one-third of the assets on the balance sheet of the United States. So, now with approximately 44 million American borrowers no longer obligated to make payments, the lack of revenue to the Federal government may have staggering national economic consequences in the long term for everyone.

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About Jill Yoshikawa, Ed M, Partner of Creative Marbles Consultancy

Jill Yoshikawa, EdM, Harvard ’99, a seasoned, 25 year educator and consultant, is meticulous in helping clients navigate all aspects of the educational experience, no matter the level of complexity. She combines educational theory with experience to advise families, schools and educators. A UCSD and Harvard graduate, as well as a former high school teacher, Jill works tirelessly to help her clients succeed.
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