Student Loan Pause Extended 

President Biden announced last week that student loan repayment is paused for an additional three months, with payments restarting May 1. A relief for many PA school graduates; this allows extra time to plan. Now is a great time to research, so you know what you’re going to do when your student loan payments begin again. 

Refinance Your Student Loans 

One option is to refinance your student loans. Student loan interest rates have been low, and if you have private loans, it could be a great time to refinance. If you have federal student loans, it would not be a great time to refinance as your student loans currently have 0% interest rates. Some are holding out for student loan cancelation, which seems unlikely. President Biden originally discussed the cancellation of up to $10,000, with some pushing for $50,000. 

Income-Based Repayment and Public Service Loan Forgiveness 

Have you worked ten years (120 payments) for a qualifying employer? You might be able to get public service loan forgiveness. Many non-profit hospitals would be qualifying employers. However, if you worked in private practice, that would not count as a qualifying employer. It is best to contact your loan servicer if you qualify for loan forgiveness. 

If you have not made 120 payments yet but are currently working for a qualifying employer, you’ll want to make sure you’re in an income-based repayment plan. These plans allow you to lower your payments based on your income. 

Continue to Make Student Loan Payments 

If you are not working for a qualifying employer and your goal is to pay off your loans quickly, you can choose to continue to make your payments. Your payment will go towards your principal as interest rates are currently 0%, helping to decrease the number of your student loans. 

The Future of Student Loans

The current administration has given you a gift of three more months of interest-free student loans; use this time to decide what your plan will be once payments resume in May. Are you going to work towards student loan forgiveness? Do you want to refinance your student loans? 

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