Your Student Loan Questions

New York Times

05-05-2025

For five years, more than 40 million Americans have not faced dire consequences if they failed to pay back their federal student loan debt. That ends today.
As the coronavirus pandemic convulsed the economy, President Trump and Congress brought relief: They allowed borrowers to take a break from their payments. The government also froze the interest, meaning borrowers' balances did not grow. People saved hundreds or even thousands of dollars per month.
The measure was popular at the time. It let people improve their credit scores, pay down other debts and build savings. So officials extended the reprieve nine times — across the rest of Trump's first term and most of former President Biden's.
But the government made those loans, and letting them go unpaid added to the deficit. Some economists also warned about sending the wrong message — that it was fine not to repay your debt. Eventually, the payment freeze ended, but policymakers said they wouldn't penalize borrowers for late payments yet.
Now even that break is gone, and late payments are showing up in credit reports for millions of people. Today, the government restarts collections on defaulted loans — first by docking tax refunds, then by garnishing paychecks and Social Security benefits. (Here's what to know about it.)
The Morning asked what you wanted to know about student loans. Today's newsletter has the answers — and looks at what comes next.
What happened to loan forgiveness?
Soaring tuition prices and government cutbacks for state schools quadrupled federal student loan debt in the 21st century. American borrowers now owe more for their educations than they do for credit cards, car loans or any form of consumer debt other than mortgages. It is a life-altering encumbrance for many people.
Democrats have for years wanted to deal with the problem through mass debt cancellation. Biden tried it. His plan to wipe away up to $20,000 per borrower cited the pandemic emergency. But the Supreme Court killed the plan, ruling Biden didn't have the authority.
Then the president expanded other established pathways to loan forgiveness, including programs aimed at public service workers, disabled borrowers, people defrauded by for-profit schools and those who had been making payments for 20 years or longer. That effort worked for five million borrowers. Martha Wilson, from Phoenix, asked The Morning: 'All my student loans were forgiven. Do I need to be concerned that they will come back and reinstate them?'
Experts say that's extremely unlikely. Biden's effort relied mostly on longstanding federal laws and policies.
What next?
A second piece of Biden's plan, though, seems doomed.
To prevent borrowers from facing bills larger than what they can pay, the government can tie your monthly payment to your income. Biden's new program to do that, called SAVE, cut some borrowers' bills in half and allowed millions of low-wage workers to pay nothing at all.
But several Republican-led states said in legal challenges that he couldn't do that, and federal courts froze the plan. (Loan forgiveness has been especially unpopular on the right. College graduates are more likely to be Democrats, although many people with student debt started degrees and never finished.) Some eight million people who enrolled in the plan are now in limbo. 'I am very confused,' says Reily Lynch, a reader from Chicago. 'Is there any update on the SAVE plan?'
The Trump administration intends to end the plan if courts don't. For now, borrowers on SAVE can simply stay on pause — they won't be considered delinquent — but that extension is nearly certain to end sometime this year. No one knows exactly when, which stresses borrowers out.
Another point of confusion is Trump's ambition to close the Education Department — the agency that owns and manages federal student debt — and move the loans to another agency. Supa Shah, from Las Vegas, asks how that would affect people: 'Will it be a mess? What should student loan borrowers do to make sure their information isn't lost or incorrect?'
Moving all those records, including contracts with the companies that collect payments, would be complicated, and it can't happen without Congress. Lawmakers and federal officials tell me there's no plan for this.
The best thing borrowers can do right now to protect themselves is go to StudentAid.gov and check on the status of their loans. The website will show you if your loan is current, in forbearance, delinquent or in default. It tells you whom to contact to make payments or request changes.
What if the data gets lost in a transfer, or what if the government removes some of it outright, as it has done in some other agencies? It's a good idea to download and make copies of the information you see on the website.
Related: Here are more tips for navigating the chaotic loan-repayment system.
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