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Biden Erases Default or Delinquency Status with Latest Student Loan Payment Pause

In addition to extending the pause of Federal student loan repayments to August 31, 2022, any borrowers who were in default or delinquency prior to March 2020, will have their status reset when repayment is scheduled to start on September 1, 2022.  ….all borrowers with paused loans to receive a ‘fresh start’ on repayment by eliminating the impact of delinquency…

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The Extra Bonus of the Student Loan Repayment Pause through May 1, 2022

Since March 2020 and extending through May 1, 2022, payments and interest on all Federal education loans, both student loans and Parent PLUS loans have been suspended as parts of various COVID-related economic relief policies. Borrowers have not been obligated to send payments, and for anyone already behind in their payments, no additional penalties have been assessed.  Yet, borrowers who…

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Why the May 13, 2021 10 Year Treasury Auction Matters to Student & Parent Loan Borrowers

Federal student loan interest rates, the cost of borrowing money to be paid at a fixed rate over the life of the loan, are set by adding 2.05% for undergraduate loans to the 10 Year Treasury Rate after the last May auction each school year. [For the upcoming 2021-22 school year, loan interest rates will be set after the May…

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Is The Golden Ticket Tarnished?

In the current economic backdrop, where the median view of economists predict a near 5% year over year decline in GDP (total amount of goods and services produced in the American economy) for 2020 (officially a recession), where both initial and continuing unemployment claims stubbornly loom above their longer run average, and though the economy seems to have bottomed, a…

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Student Loan Interest Rates for 2020-21

Federal student loan interest rates for the upcoming 2020-21 school year will be set lower than the 2019-20 school year. The 2020-21 rates will be as follows: Undergraduate Direct Loans: 2.75% Graduate Student Direct Loans: 4.3% Parent PLUS Loans: 5.3% Student loan interest rates are set annually and apply to any loan taken during that school year. The interest rates…

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Student Loan Payment Pause

On Friday, March 27, 2020, Congress and President Trump passed the CARES Act [Coronavirus Aid, Relief, and Economic Security Act], and millions of student loan borrowers gained a temporary reprieve from making payments until September 30, 2020. Additionally, as President Trump promised two weeks ago, student loan interest is also waived until September 30, 2020. Mark Kantrowitz of SavingForCollege.com, recommends:…

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Is College the New Speculation?

Often students earn college degrees to increase their likelihood of future financial stability.  Yet, as college costs are rising, students and their parents subsequently are borrowing more to earn said degree, thus students “spend” the equivalent of a few years’ of post-graduation wages while parents may delay retirement, the question is, “Is college worth the cost?” According to a recent…

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Does a Free Lunch Exist?

Here’s how to borrow $127,000 in student loans, only repay $87,000 over twenty years, and have the U.S. Government pick up the tab for the $450,000 still owed at the end of the repayment period.  [Notice the quadrupling effect on the total balance owed because of the interest that accrues in the two decade long repayment period? ]

Student Loan Interest Rate Relief In Sight

The U.S. House of Representatives passed a bill to lower Federal student loan interest rates to 3.9% from 6.8% for the upcoming 2013-14 school year–following the U.S. Senate’s passage of the same bill last week.  The rate reduction would mean  a savings of $944.44 in interest over the life of the loan, for first year college students who borrow the maximum…

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