Here's what borrowers should know as student loan payments set to resume
SACRAMENTO — If you have federal student loans, repayments start up again on October 1 after a years-long pause due to the pandemic.
As federal student loan repayments gear back up, the first order of business is pretty basic: make sure the government knows how to contact you.
"Folks really need to make sure their info is updated with their servicer and with the Federal Student Aid account," said Elizabeth Smith with the Department of Financial Protection and Innovation.
Smith said the next thing to do is explore your best repayment option, such as income-based repayments.
"The Federal Student Aid website has a loan simulator, and that's a really good tool for people to use as they're exploring all the different payment options they might have," she said.
Some borrowers will qualify for student loan forgiveness, which can be a great option if you meet the eligibility.
"If they are working in a qualifying nonprofit, or in government, there is the public loan forgiveness program and that's been around for a while," Smith said. "But you need to continue certifying your employment. You need to verify that your payment counts are accurate."
And watch out for scammers. Yes, even student loans are a target.
"There are people trying to make money off of this shift back into repayment and [borrowers] should be mindful of that and really check who they're dealing with when they get outreach from folks," Smith said.
Finally, know your rights. California is actually one of 12 states with a student borrower bill of rights.
"Loan servicers have to provide clear and accurate information," Smith said. "They have to minimize fees, they have to keep good records, and they can't engage in deceptive or abusive practices."
