July 25, 2021

Coronavirus relief for student loans is open for 3 months

Coronavirus relief for student loans is open for 3 months


More than 1.1 million Californians with student loan debt will now be eligible for three months’ relief, Gov. Gavin Newsom announced Thursday.

Twenty-one out of the 24 largest student loan servicers in the state of California have agreed to a 90-day forbearance, meaning student borrowers may stop repaying their loans without facing penalties such as late fees or fines, debt collection lawsuits, or negative impacts to their credit ratings, Newsom said.

Borrowers will also receive support in working out new payment plans.

“I want to just applaud those … servicers for their willingness to step up and help support those that are struggling to pay their student loan debts,” Newsom said at his daily news conference.

The forbearance is part of a multi-state agreement coordinated by Illinois Gov. J.B. Pritzker. While the CARES Act already halts student repayment of federal loans for six months, the measures announced by Pritzker and Newsom address private and non-federal loans in California, Colorado, Connecticut, Illinois, Massachusetts, New Jersey, Vermont, Virginia and Washington state.

Impacted borrowers should immediately contact their loan providers to get relief, as they will not automatically be enrolled, Pritzker’s office said.

“This is new, so even the lenders are getting up to speed on this,” Pritzker said during a Tuesday briefing. If borrowers experience trouble securing the agreed-upon relief, they should reach out to state regulatory agencies or the Consumer Financial Protection Bureau.

Newsom’s office did not immediately provide details on how students in California may take advantage of the loan forbearance program.

The student loan providers that signed on to the agreement include:

Aspire Resources Inc.

College Ave Student Loan Servicing LLC

Discover Financial Servicers

Earnest Operations

Edfinancial

Figure Lending LLC

Kentucky Higher Education Student Loan Corporation

Launch Servicing LLC

Lendkey Technologies Inc.

MOHELA

Navient

Nelnet

Reunion Student Loan Finance Corporation

Rhode Island Student Loan Authority

Scratch Services LLC

SoFi Lending Corp.

Tuition Options

United Guaranty Services Inc.

Upstart Network Inc.

Utah Higher Education Assistance Authority

Vermont Student Assistance Corporation





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