These U.S. senators want you to get more financial relief for your student loans.
Here’s what you need to know.
A dozen U.S. senators, including Elizabeth Warren, Bernie Sanders, Amy Klobuchar, Sherrod Brown and Cory Booker sent letters to leading private student loan lenders asking them to provide immediate financial relief to private student loan borrowers. In letters to lenders including Navient, Sallie Mae, Wells Fargo and others, the senators wrote that borrowers with private student loans should get the same benefits – including pausing student loan payments and no financial penalties – that borrowers with federal student loans receive in the CARES Act.
The CARES Act – the $2 trillion financial stimulus legislation signed into law by President Donald Trump – has several benefits for federal student loan borrowers only. As you may have read in the latest headlines about your student loans and Coronavirus, the CARES Act includes, among other benefits:
The changes will be made retroactive to March 13, 2020 and will continue through September 30, 2020. However, they only apply to federal student loans (not private student loans). These senators know that borrowers also want financial relief for private student loans.
Relief For Private Student Loans
The senators want private lenders to take the following five steps:
1. Suspend private student loan payments
The senators want lenders to suspend private student loan payments automatically with no fees, restrictions or adverse impact to a borrower’s credit. They ask that interest not accrue or capitalize and that lenders provide notice to borrowers when regular payments will resume.
2. No negative consequences for cosigners
Given that many cosigners are older and potentially vulnerable to COVID-19, the senators do not want cosigners to face any penalties for student loan payment suspension.
3. Stop collecting student loan debt
Consistent with the CARES Act and similar action in New York, the senators want companies to halt immediately any involuntary collection of student loan debt. This includes any lawsuits against borrowers regarding student loan default or student loan delinquency.
4. Cancel student loans for borrowers in financial distress
The senators want lenders to cancel or discharge as many delinquent student loans as possible. This includes borrowers who have filed for bankruptcy or who are in such financial distress they unlikely can ever fully repay their student loans.
5. Create more affordable repayment options
Finally, the senators ask lenders to allow borrowers to have access to affordable repayment options and even modify their student loans based on any long-term changes in their income.
Helpful Resources: What To Do With Your Student Loans
More Options For Your Student Loans
What else can you do to pay off your student loans more quickly and save money during this challenging period? Here are four options, all of which have no fees: