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Will Federal Student Loan Payments Return? Latest Update

Lendstart Updated: June 28, 2023 • 3 min read
how to pay student loans

May 14, 2023 Update:

US Secretary of Education Miguel Cardona formally announced that the federal student loan repayment pause will come to an end on June 30.

According to reports, student loan lenders will be obligated to inform borrowers when they need to start making payments after August 31, regardless of the outcome of Biden's Student Loan Forgiveness decision.

This means that borrowers should be prepared to start repaying their loans as early as September 2023

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For the first time since March 2020, borrowers may soon have to start making payments on their federal student loans. And that time might be coming sooner than you expect.

June 30, 2023 - The big date to know

June 30, 2023 is the date when federal student loan payments are currently scheduled to resume, unless President Biden orders the forgiveness period to be extended once more. The repayment period will only kick in if the government reaches a consensus on Biden's student loan forgiveness plan by that date -- whether it goes through, or not. Currently, the plan is stuck with the Eighth Circuit Court of Appeals, and it’s unclear when resolution on the plan will be reached.

Once June 30 hits, students will have a minimum of 60 days to start repaying. Financial experts say it’s best to start recalibrating your financial situation now to budget in student loan repayments as part of your overall financial picture. It might be wise to estimate your payment and start putting that money away in a savings account, in case you have to withdraw it.

Experts say students should be prepared to start making payments again as early as the end of July 2023. Keep in mind that once the student loan forgiveness period ends, eventually, interest will also begin accruing on your loans once more.

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How much will I have to pay?

If you graduated anytime after March 2020, it's likely that you've never sent a single federal student loan payment. To figure out how much you have to pay, take the following steps:

  1. Find out who your loan servicer is: Log into your Federal Student Aid (FSA) account online and go to the My Loan Servicers section. Alternatively, you can call the Federal Student Aid Information Center (FSAIC) at 1-800-433-3243.
  2. Find out what your monthly payment will be: All federal borrowers are automatically enrolled in the standard repayment plan at first. Under standard repayment, you pay a fixed monthly payment of at least $50 for up to 10 years, making it the quickest repayment plan available for federal loans.

What if I can't pay?

If you expect that you won’t be able to pay off your loans once the repayment period kicks back in, there are other options available to reach more manageable loan terms.

You can decide to enroll in an income-driven repayment plan. These plans cap your monthly payments at a certain percentage of your income and can also extend the term of your loan so that you have longer to pay off the loan.

Enrolling in an Income-Driven Repayment Plan

The government offers several income-driven repayment plans, which cap your monthly student loan payment at 10% of your "discretionary income." Discretionary income is your income after mandatory expenses like taxes, mortgage payments, utilities, transportation and more.

You could even be eligible to not pay anything if you make less than 150% of the federal poverty level. If you are a one-person household, the poverty guideline as of 2021 is $12,880 per year.

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Keep in mind, however, that if you enter into an income-driven repayment plan, you’ll have to self-report your income each year. You may end up paying more interest over time, paying taxes on the forgiven balance and your spouse’s income could factor into your payment amount.

For an alternative, you could consider refinancing your student loans with a private lender of your choice. But keep in mind that going this route will cause you to lose access to Biden's student loan forgiveness program if it does go through, and it will make you ineligible for income-driven repayment programs.


Even if the student loan repayment pause is extended by Biden once more come June 30, having a solid grasp of your finances ahead of that date will put you in pole position to repay your loans, should the repayment period kick back in.

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