Wednesday, December 15, 2021

Thrifty Thinking: The End of Student Loan Forbearance

 After nearly two years of pandemic relief, federal student loan payments are set to resume in February. Now is the time for borrowers to reevaluate their budgets and become reacquainted with their payment plans. 

“Federal forbearance provided much-needed relief for student loan borrowers during the pandemic, but it was always meant to be temporary,” said Jessica Ferastoaru, a student loan counselor with Take Charge America, a national nonprofit credit and student loan counseling agency. “With payments resuming in a few weeks, borrowers must not delay in creating a game plan that works for them, taking loan status, employment and income all into account.”

Ferastoaru shares options for borrowers to consider as the end of forbearance nears: 

  • Confirm your servicer(s): With several servicer changes during the forbearance period, the company that services your loan may have changed since you last made payments. Visit to confirm your loan servicers.
  • Explore income-driven repayment (IDR) plans: If your income fell in the past two years, apply for an IDR plan at to seek a lower payment. IDR plans cap payments based on income and family size, adjusting as circumstances change. You must recertify annually. If you’re already on an IDR plan, your recertification date may have been extended during the forbearance period. Contact your servicer to confirm.
  • Ask about other options: If you don’t qualify for an IDR plan and can’t afford your payment, ask your servicer about additional options like deferment or more forbearance. Under both options, payments are suspended, though with deferment, interest on subsidized loans may be waived, whereas interest will accrue under forbearance.
  • Manage defaulted loans: To avoid wage garnishment or tax refund offsets, work to get your loans out of default. Options include loan consolidation or rehabilitation. Consolidation combines your loans into one brand-new loan you agree to repay under an IDR plan. After three consecutive payments, you can change your plan, if desired. Under rehabilitation, borrowers agree to make nine consecutive, on-time payments within a 10-month period to get out of default. If your loans are currently in rehabilitation, be sure you don’t miss your first payment following forbearance. If you miss more than one while on rehabilitation, you risk being removed from the program.
  • Reestablish autopay: If you had automatic payments set up prior to pandemic forbearance, contact your servicer to confirm whether you must re-enroll to ensure you don’t miss your first payment. Your account status will change from “current” to “delinquent” after just one missed payment on a federal student loan. If your loan becomes 90 days delinquent, it can negatively impact your credit.


For step-by-step guidance with student loan repayment options, check out Take Charge America’s student loan counseling services.

About Take Charge America, Inc.

Founded in 1987, Take Charge America, Inc. is a nonprofit agency offering financial education and counseling services including credit counseling, debt management, student loan counseling, housing counseling and bankruptcy counseling. It has helped nearly 2 million consumers nationwide manage their personal finances and debts. To learn more, visit

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