Federal Student Aid (FSA) on Thursday released updated quarterly data showing the state of the federal student loan portfolio, with much of the data significantly impacted by the pause on payments and interest accrual due to the coronavirus pandemic.
Notably, fewer than 500,000 borrowers with loans in the Direct Loans (DL) program are in active repayment, as nearly 25 million borrowers with a total of $1 trillion in outstanding loans are taking advantage of the pause in payments and have their loans in an administrative forbearance status. The report covers the quarter that ended Dec. 31, 2021.
Due to the pause in payments FSA said no new DL borrowers entered default over the time period, though there has been a slight increase in borrower enrollment in income-driven repayment (IDR) plans over the course of the pandemic, a welcome sign as the Department of Education (ED) hopes to get borrowers in the payment plan that best suits their financial needs once payments do eventually resume.
According to the most recent figures from December 2021, almost 8.4 million DL borrowers were enrolled in IDR plans, up roughly 2% from the previous year. When taking borrowers in the Federal Family Education Loan (FFEL) program into account, 8.7 million borrowers are enrolled in IDR plans, who altogether hold 47% of ED-serviced balances.
With the recently announced limited waiver expanding the eligibility requirements of the Public Service Loan Forgiveness (PSLF) program and allowing some borrowers to count previous payments toward forgiveness, about 101,000 borrowers have received PSLF, temporary expanded PSLF, or limited PSLF waiver discharges through February 2022, totaling more than $7.1 billion in loan forgiveness.
“The implementation of the waiver has had a significant effect on the number of borrowers receiving forgiveness as well as the number of PSLF applications being submitted,” FSA said, adding that it would start updating the figures monthly to show how borrowers are being impacted by the waiver.
Through February, more than 80,000 borrowers have had their loans forgiven through to the waivers and more than 600,000 forms have been processed, with more borrowers expected to receive forgiveness in the coming months before the waiver deadline of Oct. 31, 2022.
Other topics covered in the quarterly data include reports on financial responsibility composite scores, proprietary institution conversions, and heightened cash monitoring.
Publication Date: 4/1/2022