How COVID-19 impacts your student loans. What you need to know about the new federal freeze on student loan interest and student loan payments.

Following action taken by the Federal government in response to the 2020 COVID-19 pandemic, federal student loan borrowers no longer need to take any action to suspend payments — your federal loan servicer will freeze them automatically. There are some student loans that are not eligible for this automatic suspension, including federal student loans under the Federal Family Education Loan (FFEL) Program loans that are owned by commercial lenders, select Perkins Loans held by the institution you attended and private student loans.

If you have private student loans, reach out to your loan server if you are in need because you have to continue paying principal and interest.

For more details regarding federally held student loans and whether or not your loans qualify for forbearance, refer to

How COVID-19 Impacts Your Student Loans

While there may have been many headlines about freezing student loan payments over the past few months, the process of halting student loans is not as simple as a headline would make it appear. There have been multiple changes over the course of March, 2020 that affect borrowers and loan suspension.  

In early March 2020, the Trump administration announced that Federal Student Loan Interest rates will be reduced to 0 percent for a period of 60 days beginning March 13, 2020. Later that month, the federal government announced individuals can suspend their payments for a period of 60 days if they request it. Then, at the end of March, the Coronavirus Aid, Relief, and Economic Security (CARES) Act, provided the automatic suspension of principal and interest payments on federally-held student loans through September 30, 2020.  

“The biggest problem is that the media is making it sound like all you have to do is stop making your payments,” said Joel Carter, spokesperson for student loan company GotZoom. “But, then you’ll be reported as paying late. What you need to do is contact your loan servicer and request forbearance.” 

According to a Department of Education press release from March 20, U.S Secretary of Education Betsy DeVos commanded all federal loan services to grant an administrative forbearance to any borrower with a federally held loan who requests one.

This process is open to all loan holders — both active and in default — and based solely on request and not on the typical administrative approval process. Borrowers have to contact their loan servicers to request the payment freeze. There is no clear response time for these requests.

What to Think About Before Requesting a Payment Freeze

Before deciding to use this new process, borrowers must consider their situations to make the best decision for themselves. For some, it might make sense to continue to make payments. 

Those who are in stable financial situations in the short term might consider continuing their payments as any payment conducted during the 60-day time period will be applied directly to the loan’s principle. For them, paying could speed up their loan paying process.  

Participants in the Public Service Loan Forgiveness program, who are required to make 120 payments before the loan is forgiven, might also consider making payments. 

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