On December 21, 2021, the U.S. Department of Education announced a ninety-day extension of the pause on student loan repayment, interest and collections, through May 1, 2022. I wanted to know what the impact on student loan borrowers and how these ninety-days would provide relief to help offset pandemic-related financial hardships. So, I reached out to Perry Carlson, AVP retail loan officer with Stephenson National Bank and Trust, who could answer this question. Carlson says, “the deferment of student loan payments has been a benefit to many people who have been struggling during COVID shutdowns.”
Carlson says, “once the deferment expires, currently the date this will happen is May 1, 2022, your payments will return, so it would be wise to continue to use good budgeting and money management habits.”
Carlson says that “some may wonder why their student loans were not paused. This is because the loan deferment only applies to federal education loans, it does not apply to private student loans.” My takeaway, if you have student loan debt, try to repay as quickly as possible and create a budget if you do not have one.