Do You Have to Request a COVID-19 Forbearance for Student Loans?

Social media users’ concern over their student loans in the midst of the COVID-19 pandemic found themselves dealing with conflicting information — even from the agencies.

Prior to the passage of the Coronavirus Aid, Relief, and Economic Security (CARES) Act on March 27 2020, one Twitter user’s advice was shared more than 24,000 times on the platform.

“Make sure you call your student loan servicer and take advantage of this Covid-19 forbearance,” she wrote. “It’s non-capitalized and IT HAS TO BE REQUESTED. Zero percent effective 3/13/20. Don’t let them play y’all. You’re welcome.”

MyFedLoan, a website operated by the federal Department of Education, also encouraged borrowers to apply for a temporary forbearance before the law was passed:

#COVID19 UPDATE: We’re making postponing payments & requesting a forbearance easy! Submit an Emergency Administrative Forbearance in 3 easy steps through your online account! ????

— MyFedLoan (@MyFedLoan) March 26, 2020

The CARES Act does, in fact, suspend student loan payments for those employing federal student loans, without interest. The department’s Federal Student Aid (FSA) website noted:

Your payments will automatically stop from March 13, 2020, through Sept. 30, 2020.
To provide relief to student loan borrowers during the COVID-19 national emergency, federal student loan borrowers are automatically being placed in an administrative forbearance, which allows you to temporarily stop making your monthly loan payment. This suspension of payments will last until Sept. 30, 2020, but you can still make payments if you choose.

The site also stated that interest will not accrue for borrowers using the Federal Family Education Loan (FFEL) and federal Perkins loan programs, as well as for defaulted and non-defaulted direct federal student loans.

It should be noted, however, that the six-month break in payments does not automatically apply to borrowers using private student loans. As Time magazine reported:

While some private lenders are allowing some borrowers to enter into forbearance, essentially pausing payments for 30, 60 or 90 days, almost none contacted by TIME are waiving interest during this time. This means in most cases, borrowers will end up owing more than they did before the economic collapse, and some people’s monthly payments may also go up. In some cases, borrowers’ balances could go up by thousands of dollars; if someone had law school debt of $145,000—the average for law school graduates—and a private loan with an interest rate of 11 percent, for instance, they would owe $4,125 more than before their forbearance because of the interest accrual.

According to the magazine, private lenders have not curtailed their collection efforts in spite of the pandemic:

One private lender, Iowa Student Loan, has filed 18 lawsuits trying to collect from borrowers since President Trump declared a national emergency on March 13, according to the Student Borrower Protection Center, which searched Iowa court records for the collection actions. In New York, lenders filed more than 20 new collection cases after the national emergency was declared, according to the Borrower Protection Center.

Following the passage of the CARES Act, the FSA’s Twitter account posted a message saying, “Our websites & communication outlets are being updated as quickly as possible to reflect changes in the law. We appreciate your patience. Stay tuned for updated info soon!” Similarly, MyFedLoan’s website referred visitors to FSA’s update on federal loan forbearance.