"Student loan borrowers adversely affected by the coronavirus, or COVID-19, can officially get some relief on their debt if they request it, according to new details announced on Friday by the Education Department (ED)," according to Yahoo Finance.
"Education Secretary Betsy DeVos directed all federal student loan servicers to grant 'administrative forbearance' to any borrower with federal loans for at least two months, if they request one. Forbearance will be in effect for “at least 60 days” starting March 13. Documentation is not required.
'This will allow borrowers to temporarily stop their payments without worrying about accruing interest,' the department stated.
When a natural disaster hits, the same type of forbearance is offered to borrowers by loan servicers. And the organization’s research from that experience shows that borrowers struggle to get on track with their loansafter being forced into forbearance, for many reasons.
'Once this crisis has abated, how do we successfully get borrowers back into successfully making loan payments?; Justin Draeger, President and CEO of the National Association of Student Financial Aid, told Yahoo Finance. 'Because this was a lot of change, and if we think that this was going to go 100% according to plan, I just think this could be a bumpy ride for borrowers. So we need to be thinking about how we smooth these transitions.'"
NASFAA's "Notable Headlines" section highlights media coverage of financial aid to help members stay up to date with the latest news. Articles included under the notable headlines section are not written by NASFAA, but rather by external sources. Inclusion in Today's News does not imply endorsement of the material or guarantee the accuracy of information presented.
Publication Date: 3/20/2020