US Secretary of Education Betsy DeVos authorizes suspension of payments, 0% interest rate on federal student loans

Related Posts

U.S. Secretary of Education Betsy DeVos authorized a 0% interest rate and suspended payments on federal student loans Monday in response to the national emergency of COVID-19, the new coronavirus.

According to the order, all people with federal student loans now have no interest on their debt for at least 60 days. DeVos is also allowing borrowers to not pay their installments for at least two months. DeVos said in a press release that the idea of providing student loan relief was President Donald Trump’s idea and she thanked him for his “quick action.”

“These are anxious times, particularly for students and families whose educations, careers, and lives have been disrupted,” DeVos said in a press release. “Right now, everyone should be focused on staying safe and healthy, not worrying about their student loan balance growing.”

DeVos’ order allows federal student loan servicers to grant an administrative forbearance for at least 60 days, when requested. It also directs an automatic suspension of payments for any borrower who has missed a payment by more than 31 days, or reaches the 31-day limit within the national emergency, to give borrowers a “safety net.”

Borrowers who wish to continue to pay still can, according to the order. In addition, loan servicers can lower monthly payments for those who experienced a change in income due to COVID-19.

Kate Finman is the university news editor. Contact her at [email protected] and follow her on Twitter at @KateFinman_DC.