Student loan payments have been on pause for nearly two years. Come May, they’re scheduled to resume.
Many of the tens of millions of borrowers will find themselves in a different financial situation then they were in March 2020, and a different payment plan may make more sense for them as a result.
Meanwhile, during the pandemic, a number of the largest companies that service federal student loans have announced they’ll no longer be doing so, meaning many will have to adjust to a new servicer in the spring.
Given all the changes, experts say borrowers should start preparing for payments to restart now.
Here’s what you need to know.
It’s understandable if you don’t totally believe that the bills will resume in May.
The pause has been extended five times over the last 24 months, and when the U.S. Department of Education announced that it was prolonging the relief in August of last year, it said that would be the final break. Then it announced in December that borrowers would get yet more time.
“You can cry wolf only so many times before borrowers no longer believe that the payment pause and interest waiver are ending,” said higher education expert Mark Kantrowitz.