The entire world is dealing with this viral pandemic. Every aspect of our lives has been impacted by the spread of the coronavirus. In America, the government has been back and forth about how to deal with the very real effects this is having on our lives. A $2 trillion stimulus was approved this week and one piece of that puzzle is student loan debt.
A high percentage of people owe and/or are paying student loans. And it looks like some relief is coming your way in this tough time, as the Department of Education has developed a plan to ease the struggle a bit.
“The federal government will no longer withhold portions of borrowers’ tax returns and Social Security payments,” Department of Education Department said in a statement. “And borrowers whose paychecks were garnished will be entitled to their full wage — although their employers must make the change to their paycheck.”
This relief will most definitely help many Americans, especially those that haven’t seen a tax refund in years. President Trump announced weeks ago that interest would be paused on student loans, setting off the need for a complete plan.
Betsy Devos, the U.S. education secretary stated, “Americans counting on their tax refund or Social Security check to make ends meet during this national emergency should receive those funds, and our actions today will make sure they do.”
If you are impacted by wage garnishments, you will need to reach out to the HR department to ensure the appropriate changes are made. All collection efforts will be paused as well.
This plan is put in effect immediately and has been backdated to start on March 13th. It will also be in place for a minimum of 60 days.
If we put it in perspective a bit, more than 830,000 borrowers are subjected to receive a refund of $1.8 billion, which is money that was already in the process of being seized by the government as of March 13th!!!
For people not necessarily in default, but still are in need of assistance have the option to suspend payments for two months without penalty.
This is a major step in allowing people to readjust and make up for the money we are missing out on due to being quarantined, laid off and furloughed. Unfortunately, this isn’t quite a loan cancellation, but it is very helpful for many of us.