TAMPA, Fla. — It's been almost a year since federal student loan payments restarted, and a recent report sheds light on how borrowers handle that debt.
Like many people, Alexandra Serra's federal student loan payments were paused during the pandemic. Then, payments restarted last October.
"You have to pay them back,” said Serra. “I did have to budget, consider my family, and you know where I could cut things from to make sure that that payment was made."
A recent U.S. Government Accountability Office report found of the borrowers whose loans had entered repayment and weren't in default about half were current on their payments, nearly 30 percent were past due on their payments, and the rest were not expected to make payments because of deferment or forbearance.
“A lot of people are really squished on everyday living expenses that basically student loans come last,” said Christie Arkovich, the founding attorney for Arkovich Law. “And so, if you have the choice of paying rent or a car payment or food, you're not going to choose student loans over one of those things."
Arkovich wants people to know about a few deadlines coming up quickly.
One is for Fresh Start, a temporary program offering benefits for borrowers with defaulted federal student loans. That program ends September 30.
The other is the temporary on-ramp period.
“The government had a rather soft start, and so for the first year, this on-ramp program prevented negative credit reporting, any kind of collection activities, and so forth,” said Arkovich. “All that ends September 30, and so come October 1, you're going to have potential garnishments and things that have really been put on hold for a long time now."
Serra started paying again about a year ago, returning to a new routine.
"Luckily, I signed up for one of their new IDR programs. I think it was SAVE, so they kinda based off your income, and it was pretty easy to manage,” said Serra. “So, I fell back into repaying and got used to that too."
Bank finally endorses Florida man's hurricane insurance check after we shared his story
Hurricane Milton left a St. Pete man’s property under water. But when he went to cash his insurance check, the bank refused to cash it. Investigative Reporter Katie LaGrone shares an update.
