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Student loan payments suspended for six months during the Senate bill

Student loan payments suspended for six months during the Senate bill
Written by David
The bill extends the plan that has already been introduced by the education department in the midst of the krona virus crisis, which allows borrowers to postpone their payments without interest for at least 60 days. However, the delayed payment benefit is not currently automatic and requires borrowers to contact their loan services to ask for help.

The Senate proposal automatically suspends these payments without interest over the next six months. It also interrupts the collection of bankruptcy – including salary and tax refund.

Education Secretary Betsy DeVos said on Wednesday that the collections will be stopped for at least 60 days.

The Senate proposal offers an additional benefit to borrowers who, for example, seek loan forgiveness through the public loan program. These borrowers should still see their debt wiped out after ten years without being penalized for not having paid in the next six months.

But the bill stays too short Democratic proposals to cancel at least $ 10,000 in student debt per borrower during the national crisis.

The Center for Responsible Lending is worried that some federal student borrowers will be released under the bill. This applies to individuals with federally held loans and excludes private loans as well as some federally guaranteed loans – probably including those paid out before 2008.

According to the bill, borrowers would still be able to pay during the six months.

Although the White House and Senate leaders struck an agreement on the legislation early Wednesday morning, an exact time for the Senate’s vote has not yet been scheduled and it is not yet clear when the House will vote to approve the measure.


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