Student loan restart: Payments to begin again as federal pause ends in three days

As the COVID-19-era pause on student loan payments ends in three days, millions of borrowers will have to resume their monthly payments.

With the payments resuming for borrowers as soon as Oct. 1, the amount borrowers owe for the first payment and when it is due will be sent out 21 days before the due date, according to the Department of Education.

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Student loan payments have been paused for borrowers since the government paused payments when the coronavirus pandemic hit the United States in full force in March 2020. The pause has been extended numerous times by the Biden administration, but following the pandemic’s end in the U.S., payments are set to resume in October.

Interest on outstanding student loans already resumed on Sept. 1 after it had been paused since March 13, 2020.

While payments do resume next month, if borrowers are unable to begin paying their loans off at that time, a “temporary on-ramp” will exist through Sept. 30, 2024. Borrowers will not be reported as being delinquent on their payments if they are currently unable to pay them until next year.

“Payments are still due, and interest will continue to accrue (add up). We will not report you as delinquent during the on-ramp, but we do not control how credit scoring companies factor in missed or delayed payments,” the Department of Education said on its website.

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This solution is available for those with direct loans, Federal Family Education Loan Program loans held by the Education Department, Federal Perkins Loans held by the Education Department, defaulted Federal Family Education Loan Program loans not held by the Education Department, and defaulted Health Education Assistance Loan Program loans.

Despite the pause ending, not all borrowers will resume payments in October. Those who graduated this spring will not have to begin making payments until their grace period ends, which is usually six to nine months after graduating from college.