Using the CARES Act to Get Forgiveness Credit for Student Loan Payments You DON’T Make!
NEWS ALERT: Updated March 30th, 2020
In this Guide I’m going to explain how you can use the new Coronavirus stimulus bill (CARES) to get credit for at least 6 monthly payments that will count towards your 120 or 240 required monthly payments to earn Federal Student Loan Forgiveness benefits!
The way this system works is that the CARES Act allows you to pause monthly student loan payments and pause student loan interest accumulation, but still receive credit for having made those payments, even if you paid $0, and for at least 6 months!
Just so we’re clear, you won’t actually have any debt “forgiven”, but you WILL be 6 payments closer to receiving student loan debt forgiveness benefits, which basically means you’re being handed free money.
Please review this post, and my post on Questions About the Coronavirus & Student Loans, then if you still have any questions of your own, feel free to post them in the Comments section below.
I’ll do my best to get you a reply within 24 hours!
But First, Let Me Give You Some Quick Advice
It takes at least 10 years to receive complete Federal Student Loan Forgiveness, and that’s only available for those borrowers who qualify for the Public Service Loan Forgiveness Program (available to Government Employees, Non-Profit Workers, Military Personnel, Nurses and Teachers).
And if you DON’T qualify for PSLF, then it’s going to take at least 20 years to get Federal Forgiveness benefits. So for most borrowers, “Forgiveness” probably isn’t the best option for dealing with their loans, especially if you’re already in financial trouble.If you're truly struggling with student debt, then you should also consider paying a Student Loan Debt Relief Agency for help. Why? Because the people working at these companies deal with student loans all day, every day, and they're your best chance at figuring out how to get your loans back under control.
I've interviewed all sorts of debt relief agencies over the past 10 years, talking to all sorts of so-called "experts", and I can tell you that in all honesty I've only found two companies I trust to offer actual financial relief to people struggling with student loans.
For help with FEDERAL Student Loans: Call the Student Loan Relief Helpline at 1-888-906-3065. They will review your case, evaluate your options for switching repayment plans, consolidating your loans, or pursuing forgiveness benefits, then set you up to get rid of the debt as quickly as possible.
For help with PRIVATE Student Loans: Call McCarthy Law PLC at 1-877-317-0455. They will negotiate with your lender to settle your private loans for much less than you owe, then get you a new loan for the much lower, settled amount. NOTE: McCarthy Law can ONLY help with Private student loans.
If you do decide to call one of these companies and you have a bad experience with either of them, PLEASE make sure to come back and let me know about it in the Comments!
How the CARES Program Offers 6 Months of Free Forgiveness Qualifying Payments
The way that Federal student loan forgiveness works is as follows:
- You must make series of monthly payments (10 years worth for PSLF, 20 years worth for people who can’t use PSLF) in order to receive forgiveness on your debt
- These payments must be made on-time, in-full, and while enrolled in one of the Income-Driven Federal Student Loan Repayment Plans (PAYE, REPAYE, IBR, or ICR)
But because the CARES Act offers you the option of utilizing a Federal Student Loan Forbearance to pause your monthly payments and interest accumulation, BUT CONTINUE to take credit for having made any payments you choose to skip between it’s passage and Septemeber 2020, that means you can get credit for up to 6 months worth of payments that you never made!
How Do I Pause My Payments With a CARES Act Forbearance?
Your monthly student loan payments are NOT paused automatically under the new CARES Act, you have to apply for them to be put into forbearance.
To get your payments paused under CARE, here’s what you’ll need to do:
- Contact your Federal Student Loans Servicing Company (if you don’t know who they are, see my Guide on figuring that out here)
- Ask your Servicer to place your loans into Forbearance until September, telling them you want to take advantage of the CARES Act pause on monthly payments and interest accumulation
- Do whatever they say you have to do to complete the process, then simply wait for them to take care of it, sit back, don’t make any payments for 6 months, and VOILA!
Seriously, it’s that simple. You don’t have to do a bunch of crazy finagling or legal paperwork or anything.
Because the country is facing a public health emergency, they’ve made this exceptionally simple and as long as you let your servicer know what you’re trying to do, you should be all set.
Other Coronavirus Relief Programs
Since millions of Americans have been impacted by the coronavirus, there are several different programs that have been put in place to help prevent it from hurting student loan borrowers, including:
- The Coronavirus Pause on Monthly Student Loan Payments
- The Coronavirus Pause on Student Loan Interest Accumulation
- The Coronavirus Pause on Federal Student Loan Collections Activities
All of these programs have been extended by the CARES Act to run from their original 2 month timeframe and to run instead through September 2020, meaning that there will be at least 6 months of worth of relief due to the Coronavirus public health emergency.
Getting Help With Federal Student Loans
Even if you don’t want to take advantage of the CARES Act student loan forgiveness loophole, I’ve got good news: there are ALL SORTS of other benefits programs that you COULD utilize for Federal student loan relief.
In fact, I’ve spent the past 10 years writing over 100 Guides on the many different programs on offer, and if you need Help with your Federal Student Loans, make sure to check out my Guides on:
- Federal Student Loan Forgiveness
- Federal Student Loan Bankruptcy
- Federal Student Loan Consolidation
- Federal Student Loan Delinquency & Default
- The Federal Student Loan Rehabilitation Program
- Federal Student Loan Wage Garnishment
- Federal Student Loan Deferment
- Federal Student Loan Forbearance
- Federal Student Loan Repayment Plans
Getting Help With Private Student Loans
And if you have private student debt, then you won’t have access to the many excellent programs listed above, but the goods news is that there are SOME programs that may be available to help you too!
For Help with your Private Student Loans, take a look at my Guides on:
- Private Student Loan Forgiveness Programs
- Private Student Loan Consolidation
- Private Student Loan Bankruptcy
- Private Student Loan Defaults
If you have any other questions about student loans, please feel free post them in the Comments section below.
I’ll do my best to get you a response within 24 hours!
Finally, Please Help Me Out!
Running this website is like working a second full-time job, and I can only continue to do that with YOUR support.
If you found this article useful, then PLEASE consider helping me out by sharing it on Facebook, Reddit, Twitter or wherever you communicate online.
The more people who visit FSLD, the more time I can dedicate to writing up Guides like this one and helping borrowers like you.
Thank you for visiting, and thank you so much for your support!
Disclaimer:Information obtained from Forget Student Loan Debt is for educational purposes only. You should consult a licensed financial professional before making any financial decisions. This site receives some compensation through affiliate relationships. This site is not endorsed or affiliated with the U.S. Department of Education.