CEDAR RAPIDS, Iowa (KCRG) – Mandatory payments on federal student loans are expected to restart after Jan.31, after the federal government suspended those payments in March due to the pandemic.
It is possible that the Biden administration will suspend payments for even longer, but borrowers should plan to restart their payments soon, as it is not guaranteed. More than 420,000 Iowans have student loan debt according to educationdata.org, the state average being $ 30,500.
Denise Fuller, director of financial advice at Horizons, A Family Service Alliance, in Cedar Rapids, said it was especially important for people who experienced a large variation in their income during the pandemic to start planning their loan repayments. students. She said there was always the option of making an income-based repayment plan that takes into account your household size and income to set your monthly rate.
“Definitely if you’ve had a change and the income is significantly less or there is no income right now, definitely contact your loan managers to have that payment adjusted,” Fuller said.
Fuller said some income-oriented plans will set your monthly rate at $ 0 depending on the circumstances. It’s important to note that you’ll continue to earn interest if your payment doesn’t cover at least that.
If you made your payments during the pandemic, you don’t get any interest, so your entire payment has gone towards your principal on the loan. This allowed those who made the payments to move forward with their repayment plan during this time.
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