I Asked Student Debt Advocates What We Need To Know About The End Of The Student Loan Pause, And Here's What They Said

"We are still, as advocates, fighting very hard for that not to happen."

Way, way back in March 2020, the CARES Act put federal student loans on hold due to the pandemic. Fast-forward to now, and even though the pandemic is definitely not over (and it's starting to feel a lot like March 2020 all over again), student loan payments are currently set to resume on Feb. 1, 2022. And people are NOT happy.

Kayden @kaydenmk

student loan company sliding back into my inbox after 2 years? baby we broke up. Stop embarrassing yourself

04:45 PM - 10 Dec 2021

Twitter: @kaydenmk

chase. @cfree94

they’re getting really pissed joe

10:46 PM - 14 Dec 2021

Twitter: @cfree94

Félix Rodríguez @flicklix

Millennials receiving emails about their student loans

08:54 PM - 10 Dec 2021

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So, to find out what borrowers need to know *right now*, I reached out to the Student Loan Debt Crisis Center, a nonprofit that educates borrowers about their loans and hopes to end student debt. President and founder Natalia Abrams and executive director Cody Hounanian gave me a call, and here's what we talked about:

1. First, we don't have all the details yet about what the end of the student loan pause will look like.

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White House press secretary Jen Psaki's comments on student loans have been framed as signaling a definitive end to this relief program, but Natalia Abrams isn't so sure. FYI, in a press conference on Dec. 10, Psaki said, "We're still assessing the impact of the Omicron variant, but a smooth transition back into repayment is a high priority for the administration. In the coming weeks, we will release more details about our plan and will engage directly with student loan borrowers to ensure that they have the resources they need and are in the appropriate repayment plan."

Abrams thinks that these remarks are more ambiguous than they've been reported, and they could leave room for a possible extension or other relief options. "A smooth transition to repayment could mean a variety of things. But it sounds weaker to me than 'this is the final-final [extension],' which is what they were saying a few months ago," she explains.

2. According to documents obtained by Politico, the Biden administration has been planning ways to prevent mass student loan delinquencies when payments resume.

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Among possible programs that we might see, the documents show plans for a three-month grace period for borrowers where late payments won't count against their credit scores. They've also discussed plans to reach out to borrowers who may be at a higher risk of defaulting and potentially offering a fresh start to borrowers who were in default before the pandemic. None of these programs are definite yet, but we could be hearing more about them in coming weeks.

3. And, most importantly, there is still time for us to put pressure on elected officials and make our voices heard.

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As of right now, there's just over a month to go before the scheduled end of the pause. While Abrams says it's a good idea to be ready for the worst, there is still time to fight back. "We are preparing for the awfulness, for lack of a better word, to happen in terms of payments being turned on Feb. 1. But we are still, as advocates, fighting very hard for that not to happen."

Cody Hounanian also notes that many people feel frustrated because the student loan pause hasn't been extended, and he urges us to channel those emotions into action. "Calling an office, sending a letter, whatever it may be, take those feelings and focus in on what will make the biggest impact. And often, that's reaching out directly to your lawmaker."

If you're feeling moved to act, you might start by signing this petition from the Student Debt Crisis Center urging president Biden to extend the pause, or check out more ways to take action. 

4. If you're not ready to start making student loan payments again, you're not alone.

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According to a recent survey, 89% of fully employed borrowers who responded said they were not financially secure enough to start making payments again in February. With rising inflation and continuing pandemic uncertainty, that's totally understandable. Additionally, 88% of respondents said that student loan relief has been critical for their financial well-being during the pandemic so far. 

5. To avoid going into default, Abrams suggests switching to an income-driven repayment plan (IDR).

Instagram: @federalstudentaid

On these programs, she says, "If you've lost your job or had a reduction in hours, then you can pay as little as $0 a month and still be on track to pay off your loans and still be in good standing."  Abrams also notes that the Department of Education will be temporarily allowing borrowers to self-report their income, which will make it much easier to switch to an IDR plan.

And you don't have to call your student loan servicer to switch your payment plan. You can do it all online at StudentAid.gov.

Abrams also notes that while deferment and forbearance are still options, they typically advise against them in favor of an IDR. "We'd always suggest being on an IDR repayment program because you're actually chipping away at the months and you're not compounding and capitalizing your interest in the same way as you do with a forbearance." 

TL;DR: The end of pandemic student loan relief isn't totally set in stone yet. It's a good idea to know your options and be prepared, but there's still time to make your voice heard.

"We don't want any help to borrowers to be perceived as helping the department collect on debt," says Abrams. "We just don't want any borrowers to fall through the cracks. But right now, we really want to be pushing everyone to, frankly, scream at the top of their lungs that we have to push this payment pause."

How have student loans affected you? Share your experiences in the comments.

And for more stories about life and money, check out the rest of our personal finance posts.