Coronavirus Emergency: Stimulus Bill Pauses Student Loan Payments Through September 30

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Before You Read, Lower Your Student Loan Payment

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Before You Read, Lower Your Student Payment

It’s that quick & easy — really. Our free tool checks a network of top refinance lenders and shows you options in one easy chart.

Checking rates takes 2 minutes with no impact on your credit
Federal & private loans are eligible
No maximum loan amount

The coronavirus crisis has dramatically impacted our national economy and the personal lives of millions — leading to an urgent response by the federal government to provide financial help.

Recently, a stimulus bill worth $2.2 trillion in aid — known as the CARES Act — was swiftly rolled out, passed by the Senate and House, and put into action by President Trump.

The new coronavirus legislation includes multiple financial support initiatives for people who need it most, including relief for student loan borrowers. Prior to this stimulus package, federal student loans were only alloto be deferred for up to two months — which has now been upgraded to a minimum of six months.

Under the CARES Act, federal student loan payments are officially postponed until at least September 30, 2020 with no penalty and zero interest. Here are all the details.

How are student loans affected by the coronavirus stimulus package?

The economic relief package includes federal student loan postponement until September 30. This postponement is essentially a federal deferment program — allowing you to completely stop any federal student loan payments you have during this approved time period without risking default, delinquency, or a negative impact on your credit score.

Besides just suspending federal loan payments, the CARES Act also pauses debt collection for anyone already in student loan default, and removes all interest from federal loans while payments are stopped.

With a 0% interest rate, you won’t have to worry about your deferred loans building six months of interest that you’d inevitably have to pay off. Your federal loans are frozen with no cost until 9/30/20 when they will resume normally.

The ability to pause these student loan payments with zero interest can be a huge help to federal loan borrowers — giving them one less monthly bill to worry about in this time of extreme financial and job uncertainty.

Which student loans qualify for postponement?

With the signed relief bill, the only student loans that can be suspended are federal loans that are held by the U.S. Department of Education.

You can check if your loans are held by the U.S. Department of Education by logging into your account at From there, you can see if your loans are eligible for the six-month loan suspension and freeze on interest.

All federal student loan repayment programs are eligible, including income-driven repayment plans and Public Service Loan Forgiveness (PSLF). If you’re enrolled in one of these programs, your paused payments during the six-month suspension will still count toward your program’s requirements.

For example, if you’re pursuing PSLF, your six postponed payments during this timeframe will still be applied toward your needed 120 monthly payments.

What about private student loans?

Unfortunately, the federal stimulus package does not cover private student loans. However, there can be solutions for private loan borrowers to get necessary relief, too.

The first step is to contact your private lender directly either by phone, email, or online chat, if you are having trouble making payments due to decreased income. Head straight to their website and find out what your options are — many lenders have essential coronavirus updates and information easily visible on their homepage.

Every private lender is different with what they can offer. But because of the financial hardship caused by coronavirus, many lenders are being very lenient with their borrowers and you may be able to get a deferment or forbearance for a certain length of time.

If you can’t get support from your lender, a smart solution could be student loan refinancing. You’ll need a good credit score and income to qualify for a refinance, or a creditworthy cosigner to apply with you.

But for those who qualify, a refinance can provide essential financial relief. You could be offered a much lower interest rate to save money both month-to-month and over the life of your new loan. Or, you could have the option to extend your repayment term — some lenders have terms up to 20 years — to drastically drop your month payment.

To see your refinance options, start with Purefy’s Compare Rates tool. You’ll see your best rates and terms from multiple well-known lenders — all with one fast form and no impact to your credit score whatsoever.

How do you opt-in to the stimulus bill’s federal student loan freeze?

You do not have to actively enroll in this student loan “grace” period to forego your federal loan payments.

Anyone with federal student loans is automatically part if this stimulus bill and can benefit from the payment suspension.

However, participation in this relief act is optional. You can choose to continue making payments if your budget allows it. Because of the 0% interest rate, your payments during this period will be applied in full to your loan’s principal balance — allowing you to pay off your loans faster than usual.

Should you postpone student loan payments during coronavirus?

If you have federal student loans, you can stop paying your bills until September 30, 2020 with no interest, late fees, penalties, or risk of default.

If you’re currently struggling financially because of coronavirus, this can be a great way to have more money each month for things you really need.

On the other hand, if your income has stayed steady, any payments you make during this six-month period will go straight to your loan principal. This will reduce tour total interest and help pay off your loans faster.

Ultimately, your balance isn’t going anywhere. Be sure to plan ahead and be prepared for your loan payments to restart at the end of September. Keep an eye on your account balance and billing statements to ensure your payments aren’t coming out automatically during this deferment period.

All in all, there really isn’t much of a reason to not take advantage of this stimulus benefit — unless you have money to spare and would like to chip away at your loan balance while your interest is waived.

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