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July 05, 2023 at 04:53 PM
What You Need to Know
- Student loans will begin accruing interest again on Sept. 1, with payments resuming in October.
- However, the Biden administration has already announced a new plan designed to bring relief to borrowers.
- For now, clients with student loan debt should plan on restarting payments in a few months.
The U.S. Supreme Court has handed down its final ruling denying President Joe Biden’s power to forgive up to $20,000 in student loan debt for millions of Americans under the Higher Education Relief Opportunities for Students Act.
Many student borrowers are wondering what they should do now that the Supreme Court has finally issued its decision on Biden’s student loan forgiveness plan — and much of the nation is looking to Biden’s newly released plan to tackle the issue of student loan forgiveness.
It’s important for clients with student debt to take action quickly, as the student loan repayment freeze will soon be over. Those clients should also look ahead to options and relief that may be newly available since the last time the borrower made a student loan payment.
Next Steps for Student Borrowers
Student borrowers should be aware that interest on their loans will once again begin accruing on Sept. 1. Payments themselves will resume in October.
Because many borrowers have not accessed their accounts in up to three years, clients with student loans should be advised to access their accounts now to avoid problems once payments resume. Many accounts have been transferred between loan servicers over the past three years — and some borrowers will have to recreate online accounts with new servicers. It’s estimated that up to 30 million accounts have changed hands since early 2020.
Because student loan servicers are understaffed, clients with student loans should call soon if they have questions about their accounts. It is expected that wait times to speak with an actual person could be long.
Once clients are able to access their accounts, they should look for new repayment options that could grant some relief based on the client’s income level.
