Struggling to pay your student loan debt amid coronavirus? You can now delay 3 payments
More than 1.1 million Californians with student loan debt will now be eligible for three months’ relief, Gov. Gavin Newsom announced Thursday.
Twenty-one out of the 24 largest student loan servicers in the state of California have agreed to a 90-day forbearance, meaning student borrowers may stop repaying their loans without facing penalties such as late fees or fines, debt collection lawsuits, or negative impacts to their credit ratings, Newsom said.
Borrowers will also receive support in working out new payment plans.
“I want to just applaud those ... servicers for their willingness to step up and help support those that are struggling to pay their student loan debts,” Newsom said at his daily news conference.
The forbearance is part of a multi-state agreement coordinated by Illinois Gov. J.B. Pritzker. While the CARES Act already halts student repayment of federal loans for six months, the measures announced by Pritzker and Newsom address private and non-federal loans in California, Colorado, Connecticut, Illinois, Massachusetts, New Jersey, Vermont, Virginia and Washington state.
Impacted borrowers should immediately contact their loan providers to get relief, as they will not automatically be enrolled, Pritzker’s office said.
“This is new, so even the lenders are getting up to speed on this,” Pritzker said during a Tuesday briefing. If borrowers experience trouble securing the agreed-upon relief, they should reach out to state regulatory agencies or the Consumer Financial Protection Bureau.
Newsom’s office did not immediately provide details on how students in California may take advantage of the loan forbearance program.
The student loan providers that signed on to the agreement include:
Aspire Resources Inc.
College Ave Student Loan Servicing LLC
Discover Financial Servicers
Figure Lending LLC
Kentucky Higher Education Student Loan Corporation
Launch Servicing LLC
Lendkey Technologies Inc.
Reunion Student Loan Finance Corporation
Rhode Island Student Loan Authority
Scratch Services LLC
SoFi Lending Corp.
United Guaranty Services Inc.
Upstart Network Inc.
Utah Higher Education Assistance Authority
Vermont Student Assistance Corporation
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