Apr 17, 2025
Federal student loan borrowers have endured five years of chaotic changes as various relief programs started, stopped and shifted. But the return to “normal” may be the messiest change of all.
Payments formally resumed in October 2023, though former President Joe Biden and his administration paused repayment for certain types of loans for most of 2024.
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The past few months have seen more twists, like the apparent death of the Saving on a Valuable Education (SAVE) plan and income-driven repayment (IDR) applications being down for weeks.
While confusion may be understandable, the 43 million people with an outstanding loan need to know there’s a price for any mistakes from here out.
What’s going on?
As of early March, around 9 million borrowers were late on their payments — with almost half being more than 90 days late — according to data obtained by NPR.
Being 90 days delinquent puts you at risk of a severe hit to your credit score. And bad credit means higher borrowing costs, lower borrowing limits and can even make it harder to find a place to live.
In the worst-case scenario, borrowers will be in default if they go at least 270 days without making a payment. At that point, you could have your wages garnished, see federal benefits withheld and even be charged legal fees if you end up in court.
Many student borrowers may not know whether they need to start paying on their loans. For the 8 million who signed up for the SAVE plan before federal courts put the plan on hold, payments aren’t required just yet.
However, those who wanted to sign up for other IDR plans (or update their information) couldn’t do so until now. This led to many borrowers seeing their monthly payments go up significantly while the form was down. In fact, there have been reports of some borrowers’ monthly payments quadrupling.
Unfortunately, there may be more confusion over what is happening. But you do have some control over how you can manage your student loan debt.
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How to manage your student loans
Your best bet is to regularly check StudentAid.gov for the latest developments.
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Fixed repayment plans like the standard and extended repayment plans remain unchanged. Whatever you owe under one of these plans will likely stay the same unless you change to a different repayment plan.
For those on IDR plans, you should head to StudentAid.gov and submit a recertification request if you're due to do so.
In many cases, your recertification date may have been extended by a year if you were required to recertify when the application forms were down. However, if you were late in doing so — that is, your recertification was due before the forms went down — then the loan servicer most likely recalculated your payment amount.
Those on the SAVE plan have been placed on general forbearance for now.
Even if you believe you don’t owe any payments or anticipate the amount going up, these days it’s still a good idea to contact your loan servicer to see what is happening.
Consider setting aside a part of your paycheck now to anticipate future payments. Or, you may want to talk to them about consolidating multiple federal loans if it makes sense.
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Sarah Li-Cain, AFC is a finance and small business writer with over a decade of experience.
