Student loan payments are set to resume on Oct. 1, after the three-year pause during the COVID-19 pandemic.
Following the Supreme Court’s 6-3 decision to strike down the student loan forgiveness plan proposed by President Joe Biden, students are now expected to restart their monthly loan payments.
Students who have loan debts will restart their monthly payments on Oct. 1. However, an option to postpone payments for up to an additional year is available.
The “On-Ramp” period is meant to be a safety net for people who struggle to pay their monthly loans. However, interest will continue to accumulate for those who utilize the on-ramp option, which will increase the amount of money owed.
During a June 30, 2023, press conference, Biden explained the On-Ramp period as such.
“During this period, if you can pay your monthly bills, you should,” said Biden, “but if you cannot, if you miss payments, this ‘on-ramp’ will temporarily remove the threat of default or having your credit harmed, which can hurt borrowers for years to come.”Signing up for On-Ramp is automatic, so borrowers will not have to worry about an additional form that needs to be filled out.
The on-ramp period will begin immediately as re-payments resume for borrowers will continue through Sept. 30, 2024.
Here are some helpful tips for borrowers before payments resume:
If you were enrolled in automatic payments before the pandemic pause, you will likely need to re-enroll by logging into your lending service website.
Autopay is optional, but borrowers can save up to .25% on interest payments by enrolling.