Millions of student loan borrowers with loans made by private lenders and federal loans not owned by the U.S. Government were left out of the relief included in the CARES Act passed by Congress last month.
Under a new initiative announced on Wednesday, Virginians with commercially-owned Federal Family Education Loan loans, Perkins loans, or privately held student loans who are struggling to make their payments due to the ongoing COVID-19 pandemic will be eligible for expanded relief.
Borrowers in need of assistance must immediately contact their student loan servicer to identify the options that are appropriate to their circumstances. Relief options include:
- Providing a minimum of 90 days of forbearance
- Waiving late payment fees
- Ensuring that no borrower is subject to negative credit reporting
- Ceasing debt collection lawsuits for 90 days
- Working with borrower to enroll them in other borrower assistance programs, such as income-based repayment
These options will provide short-term relief for borrowers with significant changes in their income, which is advisable over the option of non-payment which can lead to default. Borrowers should note that these solutions will impact the terms and conditions of the loans.
Before exercising these options, carefully consider the impact of the interest that accrues during the 90-day forbearance and how it will extend the repayment schedule for the loans.
The Office of the Qualified Education Loan Ombudsman at the State Council of Higher Education for Virginia is responsible for helping Virginia student borrowers understand their rights and responsibilities. The Student Loan Advocate serves as a liaison between student loan borrowers and loan servicers or other agencies, helping them explore repayment options and aiding in the resolution of complaints against loan providers.
Other states in the initiative include California, Colorado, Connecticut, Massachusetts, New Jersey, Vermont, and Washington.
Private student loan servicers providing relief include:
- Aspire Resources, Inc.
- College Ave Student Loan Servicing, LLC
- Earnest Operations, LLC
- Edfinancial Services, LLC
- Kentucky Higher Education Student Loan Corporation
- Lendkey Technologies, Inc.
- Higher Education Loan Authority of the State of Missouri (MOHELA)
- Navient
- Nelnet, Inc.
- Scratch
- SoFi Lending Corp.
- Tuition Options, LLC
- United Guaranty Services, Inc.
- Upstart Network, Inc.
- Utah Higher Education Assistance Authority (UHEAA)
- Vermont Student Assistance Corporation (VSAC)
Borrowers can visit the U.S. Department of Education’s Office of Federal Student Aid or call Federal Student Aid Information Center at 1-800-433-3243 or 1-800-730-8913 (TDD) to determine the types of federal loans they have and who their servicers are. Borrowers with private student loans can check their monthly billing statements for contact information. Borrowers can also file a complaint with the Consumer Financial Protection Bureau here.
Borrowers experiencing trouble with their student loan servicer or looking to better understand the implications of these relief options are encouraged to contact Virginia’s Student Loan Advocate at [email protected] or (804) 786-2832.
For additional information about relief options for federal loan borrowers, visit schev.edu/studentloan.
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