If you have been taking advantage of the COVID-19 Emergency Relief and federal student loan forbearance program the last two years, you should know that the student loan forbearance is scheduled to stop at the end of this month, on August 31, 2022. This payment pause included a suspension of loan payments, a 0% interest rate, and a stopped collection on defaulted loans since the COVID-19 pandemic.
While it is still unclear whether the Biden Administration will extend this student loan forbearance program, it is a good time to start preparing to make payments again next month. So, you may be asking yourself, “How do I prepare for repayment to resume?” Well, first and foremost, login to your profile on your loan servicer’s website to ensure all your information, including email, phone number, and address is up to date, since you may have not taken a look at it in a year or two. Next, for those of you wondering what your new payment will look like, it’s a good idea to reach out to your loan servicer to get an estimation.
Once you receive some clarity on what your new payment will look like, you may want to revisit your budget to see how this additional payment will fit in. Make sure you are projecting your budget for the rest of the year and beyond to include this payment whether there is another extension or not. We will continue to monitor updates on the forbearance and how you should be preparing for the re-payments to resume.
As we’ve been discussing, we are over halfway through the year which marks a great time to check-in and adjust your financial plan in general. Call or reach out to your student loan servicer with more particular questions as you look into your situation. Additionally, if you have further questions on your student loans and how to adjust your budget, please email us at info@shermanwealth.com or schedule a complimentary call here as we are here and happy to help you talk and work through it.
