Federal student loan payments paused in March 2020 and resumed in October 2023

If you have federal student loans, your payments stopped during the pandemic pause. That pause ended on October 1, 2023, and payments resumed on that date. If you did not make a payment by then, your loan entered repayment status and you owed the first monthly amount.

The pause affected all federal loans held by the Department of Education — Direct Loans, Federal Family Education Loans (FFEL), and Perkins Loans. Private student loans were never paused. If you have private loans, your payments continued throughout the pandemic and were not affected by the resumption date.

When payments resumed, your monthly amount depended on your loan type, the repayment plan you chose, and your income if you were on an income-driven plan. The federal government did not automatically choose a plan for you; if you did not select one before October 2023, your loans moved to the Standard Repayment Plan, which has a 10-year term and fixed monthly payments.

Key Takeaways

  • Federal student loan payments resumed on October 1, 2023, after a pause that began in March 2020.
  • If you did not choose a repayment plan before the pause ended, your loans moved to the Standard Repayment Plan with a 10-year term.
  • Your first payment was due by October 1, 2023; if you missed it, your loan was considered delinquent and your credit report was affected.
  • You can change your repayment plan at any time by logging into your loan servicer's website or calling them directly.
  • Income-driven repayment plans may lower your monthly payment if your income is low, but they extend the loan term and increase total interest paid.

What your payment amount depends on

Your monthly payment is calculated based on three things: your loan balance, your repayment plan, and (if you chose an income-driven plan) your income and family size. The Standard Repayment Plan divides your total loan balance by 120 months, so the payment is the same every month. Other plans — Graduated, Extended, or income-driven — use different formulas that may start lower and increase over time, or that recalculate each year based on your income.

If you are on an income-driven plan, you must recertify your income every year, usually in October. If you do not recertify, your plan reverts to Standard Repayment. Recertification takes about 10 minutes on your loan servicer's website and uses tax information from the IRS, so you do not have to upload documents unless your situation is unusual.

Your loan servicer is the company that collects your payments. You can find out who services your loans by logging into studentaid.gov and viewing your loan details, or by calling the Federal Student Aid Information Center at 1-800-4-FED-AID (1-800-433-3243).

How to make your first payment and set up automatic payments

Your first payment after the pause was due by October 1, 2023. You can make a payment through your loan servicer's website, by phone, or by mail. Most servicers allow you to pay online for free and charge a fee if you pay by phone or mail. Paying online is the fastest and cheapest option.

To set up automatic payments, log into your servicer's website and look for "autopay" or "automatic payment" in the account settings. You will provide your bank account number and routing number, and choose the date each month when the payment should come out. Automatic payments reduce your interest rate by 0.25 percent on most federal loans, so setting them up saves money over the life of the loan.

If you missed your October 2023 payment, your loan became delinquent. A delinquent loan appears on your credit report and can lower your credit score. The longer you go without paying, the worse the damage. If you are behind, contact your servicer when ready — they can work with you on a payment plan or help you move to a lower-payment plan if your income has changed.

What happens if you cannot afford your payment

If your monthly payment is more than you can pay right now, you have several options. The fastest is to switch to an income-driven repayment plan, which calculates your payment as a percentage of your discretionary income — usually 10 to 20 percent of what you earn above the poverty line. On these plans, your payment can be as low as $0 per month if your income is low enough.

Income-driven plans have names: Revised Pay As You Earn (REPAYE), Pay As You Earn (PAYE), Income-Based Repayment (IBR), and Income-Contingent Repayment (ICR). REPAYE is usually the lowest-payment option and is open to all borrowers. The others have income limits or require you to have taken out loans in a certain year. Your servicer can tell you which plans you are may be able to access for.

You can also ask for a deferment or forbearance, which pauses your payments temporarily. Deferment stops interest from accruing on subsidized loans; forbearance does not. Both appear on your credit report as a pause in payments, which is better than delinquency but still affects your score. Deferment and forbearance are meant to be temporary — usually 6 to 12 months — while you look for work or handle a hardship.

How the pause affected your loan balance and interest

During the pause, your loan balance did not grow even though interest was still accruing on most loans. The federal government paid the interest for you on subsidized loans, so your balance stayed exactly the same. On unsubsidized loans, interest accrued but was not added to your balance; instead, it was capitalized (added to your balance) when payments resumed on October 1, 2023.

Capitalization means you now owe more than you did before the pause. If you had an unsubsidized loan with a $10,000 balance on March 13, 2020, and interest accrued at 5 percent per year, you owed roughly $10,850 when the pause ended. That extra $850 was added to your balance, and you now pay interest on the new total.

You can see whether your loans are subsidized or unsubsidized by logging into studentaid.gov. Subsidized loans are usually older or were taken out when you were in school full-time. Unsubsidized loans are newer or were taken out after you left school. If you have both types, your servicer will explore your payment to the unsubsidized loans first.

Changes to your loans after the pause ended

The federal government made several changes to federal student loans when the pause ended. The most important is that borrowers with a balance of $20,000 or less who had taken out Pell Grants received up to $20,000 in forgiveness; borrowers without Pell Grants received up to $10,000. This forgiveness was applied automatically to loans held by the Department of Education in November 2023.

If you received forgiveness, your loan balance was reduced and your monthly payment was recalculated. If you were on an income-driven plan, your payment may have dropped to $0 or a very low amount. If you were on Standard Repayment, your payment was recalculated based on your new, lower balance.

The federal government also created a new income-driven plan called SAVE (Saving on a Valuable Education), which launched in 2023 and became available to all borrowers in 2024. SAVE calculates your payment as 5 percent of discretionary income instead of 10 to 20 percent, making it the lowest-payment option for most borrowers. You can switch to SAVE at any time through your servicer's website.

What to do if you have not made a payment yet

If you have not made a payment since October 1, 2023, contact your loan servicer right away. Tell them you want to make a payment and ask about your options if you cannot pay the full amount. Do not wait for a bill or a notice — the sooner you contact them, the sooner you can stop the delinquency from growing.

If you are having trouble finding your servicer, go to studentaid.gov, log in, and look at your loan details. Your servicer's name and phone number are listed there. You can also call the Federal Student Aid Information Center at 1-800-4-FED-AID and they will tell you who services your loans.

If you have private student loans, contact your lender directly. Private loans were never paused and your payments should have continued throughout the pandemic. If you fell behind on private loans, your lender may have already reported the delinquency to credit bureaus. Catching up as soon as possible will prevent further damage to your credit score.

Frequently Asked Questions

Can I go back on the payment pause if I cannot afford my payment?

No, the pause ended permanently on October 1, 2023, and will not restart. However, you can switch to an income-driven repayment plan, which may lower your payment to $0 per month if your income is low. You can also ask for a deferment or forbearance if you are facing a temporary hardship.

What happens to my credit score if I missed a payment?

A missed payment appears on your credit report as a delinquency and lowers your credit score. The longer you go without paying, the worse the damage. If you are behind, contact your servicer when ready to set up a payment plan or switch to a lower-payment plan. Catching up will stop further damage, though the delinquency will remain on your report for seven years.

Do I have to pay back the interest that accrued during the pause?

On subsidized loans, no — the federal government paid the interest for you. On unsubsidized loans, yes — the interest was capitalized and added to your balance when the pause ended. You now owe interest on the capitalized amount, which increases your total loan cost.

Can I change my repayment plan after the pause ended?

Yes, you can change your plan at any time. Log into your servicer's website or call them to switch to a different plan. If you moved to Standard Repayment automatically because you did not choose a plan before October 2023, you can switch to an income-driven plan or another option right now.

What is the difference between REPAYE and SAVE?

SAVE calculates your payment as 5 percent of discretionary income, while REPAYE calculates it as 10 percent. SAVE is the newer plan and has a lower payment for most borrowers. Both are income-driven plans that recalculate your payment each year based on your income. You can switch to SAVE through your servicer's website.