When Will Student Loan Payments Resume?

Posted 2/27/2023

Confused about when (and if) student loan payments will restart? You’re not alone. The answer’s a bit convoluted. We’ll walk you through it.

A Timeframe, Not a Date

Rather than announce an end date, the government announced a timeframe for when the student loan payment pause will end. Bottom line: the earliest possible date is May 1 and the latest is August 30.

Why the confusion? It’s largely due to legal challenges brought against the Biden-Harris student loan forgiveness plan. The Supreme Court is set to settle the matter during the first half of 2023, and it could have a monumental impact on loan payments.

The Biden administration would prefer a ruling before ending the payment pause. As a result, they announced repayment will begin 60 days after the Court’s decision. However, if the Court declines to rule by June 30, 2023, payments will begin 60 days after that.

Will the Payment Pause Be Extended?

The payment pause has been extended eight times. The government declared more than one of those extensions be the final one.

But things are a bit different this time. President Biden recently announced plans to end the national emergency declared over the coronavirus pandemic. The move indicates his administration is pursuing a return to “normalcy”. While there could be another extension, it’s safer to assume that policy will carry over to student loans.

What About Loan Forgiveness?

If the Court rules in favor of student loan forgiveness, approximately 13.3 million borrowers will have their loans completely wiped out. They’ll never reenter repayment.

If you owe less than $10,000 in student loans ($20,000 if you have a Pell Grant), you’re part of that group. Everyone else who qualifies should have lower monthly payments.

A ruling against loan forgiveness maintains the pre-pandemic status quo. Borrowers’ debts will not change, and all will reenter repayment later this year.

What Can You Do Today?

The best time to review your loans is right now. When payments restart, all sources of guidance and help will be overwhelmed and it will be difficult to connect with your loan servicer.

Don’t wait for payments to restart to act. It will be much easier to fix any problems with your loans now than after the pause ends. The following steps should prepare you for the restart:

1. Update Your Contact Info – Make sure your loan servicer and gov have your latest contact info. This is the best way to make sure you stay current on changes to repayment over the next year.
2. Review Your Monthly Payment – Sign into StudentAid.gov to check on what you’ll be paying each month.
3. Investigate Alternate Repayment Plans – If you can’t afford your monthly payment, investigate income-driven repayment plans. You can contact your loan servicer to switch plans free of charge.
4. Build a Buffer – We don’t know if the Supreme Court will uphold student loan debt relief. The smart move is to plan as if the court will rule against the program. Try to save enough cash to make your first monthly payment. If the debt relief goes forward, you’ll have some extra money to spend. If it’s rejected, you won’t get caught off guard.
5. Watch Out for Scams – Scammers thrive in confusion. It’s easier for them to take advantage of you if you don’t have the facts. Learn how to avoid scammers in this article.