Student loan interest resumes September as pause on payments nears end
(FOX 2) - After more than three years of no interest growth on student loans, the federal government's pause interest rates being set at zero has ended.
The COVID-19 Loan Payment Pause was initiated on March 13, 2020, due to the onset of the pandemic. The emergency order led to an administrative forbearance, which paused loan payments and set interest rates at 0% for eligible federal student loans.
Beginning Sept. 1, the emergency 0% interest rate has ended and regular interest rates have resumed.
According to the U.S. Department of Education, payments will also resume starting in October. The first bill when student loans resume will arrive 21 days before the due date.
MORE: High court's cancelation of student debt relief affecting 864k Michigan residents
During the Covid emergency, most federal student loans were eligible for a pause, including direct loans, Federal Family Education Loan Program loans, Federal Perkins Loans, and some defaulted loans.