Some student loan borrowers are planning a “walkout” if student loan payments resume anytime soon.
Here’s what you need to know.
While student loan payments are set to resume after May 1, 2022, it’s possible that President Joe Biden could extend the student loan payment pause for a fourth time. If that doesn’t happen, however, The Debt Collective — a debtor collective fighting against student loan cancellations — wants you to go on strike with your student loans. If federal student loan payments resume after May 1, the Debt Collective is lobbying for all student loanees to band together, strike together, and get to $0 a month “as safely as possible.” While the debt collective is now warning against defaulting on student loans, some borrowers may simply stop paying their student loans. Why? Some may not be able to afford it, some may object, and some others may not be eligible for $0 monthly student loan payments.
That said, here are 5 ways to get $0 monthly student loan payments, according to Debt Collective:
1. Get student loan cancellation by defending the borrower to repay
The first option to get $0 monthly student loan payments is to file a petition for borrower defense against repayment. Borrower Defense for Repayment is available for student loan borrowers who have been misled by their college or university. Student loan borrowers who qualify may receive partial or full cancellation of their federal student loan debt. You may file a student loan repayment borrower defense application if the school you attended committed wrongdoing or if you can show that the school broke state law in connection with your student loans or the educational services provided. You can file a borrower’s defense attorney with the US Department of Education for repayment and hold your student loans in administrative leniency while you await a response.
(6 Major Changes in Student Loan Forgiveness)
2. Apply for government loan forgiveness
You can get student loan cancellation through government loan forgiveness. This is a federal program created to help student loan borrowers who work for a qualified government agency or nonprofit employer. (Do you qualify for $5 billion in student loan forgiveness?). To qualify, you must be working full-time (40 hours minimum per week), enrolled in an income-tested repayment plan, and making at least 120 monthly student loan payments. If you have previous student loan payments that do not qualify for student loan forgiveness, you should complete a limited waiver. This allows you to count previously ineligible student loan payments, e.g. B. Late or partial student loan payments or student loan payments that do not qualify.
3. Get a $0 per month income-based repayment plan
Yes, it is possible to pay $0 per month for your student loans. As? Sign up for an income-tested repayment plan if you are struggling to make federal student loan payments. The four main income-contingent repayment plans are Income-Contingent Repayment (IBR), Pay As You Earn (PAYE), Revised Pay As You Earn (REPAYE), and Income-Contingent Repayment (ICR). You can enroll through your student loan administrator. Your monthly student loan payment is based on your discretionary income and family size. As this may have changed during the Covid-19 pandemic, now is a good time to update this information to determine your new monthly student loan payment. You can also get student loan forgiveness on your federal student loans through income-tested repayment.
(Will student loan payments be postponed to 2023?)
4. Consider deferring student loans
The Debt Collective wants student loan borrowers to know that student loan deferral is an option to pay $0 a month on your federal student loans. If student loan payments resume after May 1, the US Department of Education wants to ensure that student loan borrowers can smoothly transition to student loan payments. This is especially important for financially vulnerable borrowers, who could be more likely to face a student loan arrears or default. For this reason, the Department of Education is considering advising student loan service providers not to report late payments to credit bureaus for three months after student loan payments resumed. The Debt Collective encourages student loan borrowers to consider student loan forbearance for three months (e.g., through August 2022) to defer student loan payments. Importantly, the downside to forbearance is that interest will accrue on your federal student loans during this period. If you can’t afford your student loan payments, you’re usually better off considering an income-based repayment plan instead.
(Where Biden Stands on Student Loan Ease)
5. Stay in school
While staying in school can lead to more student loan debt, staying in school also comes with student loan deferral. While studying, you don’t have to make student loan payments. The same goes for your federal student loans for six months after graduation. However, all unsubsidized federal student loans will accrue interest on your student loans.
(Student loan cancellations for borrowers reduced to $25,000).
Student loan: What you should know
It is possible that one or more of these options may be appropriate for your unique situation to receive $0 monthly student loan payments. Conversely, it’s possible that none of these options will work. If this is the case, contact your student loan officer to determine the best options available. If you can’t get $0 monthly student loan payments on federal student loans, you may still be able to reduce your monthly payments. It’s important to realize that simply not paying your student loans is a bad strategy. If you have financial problems, contact your student loan administrator in advance. Likewise, not paying your student loans out of protest or because you think student loans are unfair will only hurt your credit score.
With the student loan exemption ending, make sure you evaluate your best options. Here are some popular ways borrowers can pay off their student loans: