The Final CARES Act Extension for Defaulted Loans
Before coronavirus, 1 in 10 federal student loan borrowers were in default. Thankfully, the CARES Act has protections to prevent borrowers from becoming delinquent or entering default.
The Office of Federal Student Aid began granting temporary relief on federal student loans on March 20, 2020. Payments on defaulted loans were suspended, collections and garnishments were halted, and a 0% interest rate was introduced. Recently, a final Executive Order extended the payment freeze to May 1, 2022.
This means it’s a great time to resolve your defaulted loans.
Normally, a debt rehabilitation program would mandate that you make 9 on-time monthly payments over the course of ten months, equal to 15% of your yearly discretionary income.
Due to the current payment suspension, if you have defaulted student loans, this final Cares Act extension will allow you to begin your debt rehabilitation program with a $0 monthly payment, and those $0.00 payments will still count toward your recovery program!
Contact us now to walk you through the exact requirements of this opportunity.
Wage and tax garnishment for borrowers of federally held student loans have been placed on hold until May 2022, thanks to the CARES Act. You will earn credit for the $0 dollar payments toward your rehabilitation months as well as the added benefit of suspended garnishment if you begin your rehabilitation now while the suspension period is still in effect.
Even if all of your required payments were $0 dollar installments protected by the payment suspension, you can petition to have the garnishment waived once you've completed the first six months of rehabilitation. For additional information on how to get started right now, give us a call.
Even If you have already resolved your defaulted loan status, we can still help...
We can help you enroll into an IDR program, potentially lower your payment and provide you with information about our new client portal, which will keep all of your documents organized.
If you have already completed loan rehabilitation for your defaulted loans or will soon be completing 6 payments while still in this payment suspension period, get the most out of this final extension. Give us a call right now and speak with one of our account managers.
Make the Final Months of Student Loan Relief Really Pay Off
All good things must come to an end, and for federal student loan holders, that end will be on May 1, 2022. So, you’ve got a few months left to take full advantage of all the CARES Act has to offer. Should you have any questions or need assistance, please contact Customer Service or simply reply to this email. We are happy to help you!
Important Note: Please check your Client Portal weekly for processing updates, program information, and to learn what issues may have occurred regarding your case. The Client Portal feature will be our main source of communication with you moving forward.
(Don’t have a Client Portal yet? Please reply to this email and we will send your personalized login information)