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Why 2020 Is Different for Student Loan Payments

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If you don’t get a notice or if you get one indicating a first-payment due date after January, contact your loan servicer to make sure it has up-to-date contact information for you and to confirm the date, Ms. Yu said.

Scott Buchanan, executive director of the Student Loan Servicing Alliance, a trade group, said borrowers could choose a payment option now and revise it later if their financial circumstances changed.

“Now is a great time to do it,” he said, before an anticipated rush in January, when some 30 million borrowers are expected to re-enter payment status.

But Moira Vahey, a spokeswoman for the Student Borrower Protection Center, an advocacy group, said servicers were not currently processing enrollments in “income driven” payment plans. Borrowers can protect themselves, she said, by submitting an application now so it is on file when servicers do begin processing them again.

More information about payment plans is available on Studentaid.gov.

About two-thirds of students who graduated from college in 2019 had education debt, owing just under $29,000 on average, according to the Institute for College Access and Success, a nonprofit group. That was a bit lower than the share of 2018 graduates with debt, and a slight drop in the average debt owed. While that’s “encouraging,” the institute recently said, the economic fallout from the pandemic could make college less affordable, pushing students to borrow more.

Here are some questions and answers about repaying student loans:

Should I repay my student loans if I can afford to, even during the suspension?

If you have the means to pay, it generally makes sense to do so unless you have higher-interest debt that you want to pay down, Ms. Mayotte said. If you don’t make payments, you aren’t reducing the amount you owe — the debt is being delayed, not forgiven.

Also, since interest on student loan balances was reduced to zero during the suspension, payments made now can help pay down the principal or at least reduce the amount you’ll pay in interest, she said. (Interest that accrued before the payment pause began on March 13 — such as interest on “unsubsidized” federal student loans, which typically accrues while the student attends college — generally will be added to the loan’s balance when repayment begins.)

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