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Experts share advice for borrowers scrambling after resumption of student loan repayments expected to resume this fall – NBC Chicago

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It’s the elephant-sized debt in the room that no one wants to talk about: Student loan repayments are set to resume this fall after a three-year pause imposed during the COVID-19 pandemic.

After last week’s landmark Supreme Court ruling, justices struck down President Biden’s student loan forgiveness plan, meaning billions of dollars in student loan debt will still be outstanding.

And from September 1, loans will start earning interest, with invoices likely to be mailed and due in October.

The resumption of student loan repayments has many borrowers scrambling to find where they will find extra money each month, like Amanda Burris, a graphic design student in Chicago.

“I only have about $5,500 in student loans, and they’re all under the federal subsidized loan program,” Burris said. “Certainly could be worse off, loan-wise.”

Many in Illinois are in this worse situation.

More than 924,000 borrowers have student loan debt, totaling more than $29 billion in college debt, according to online lender LendingTree.

The average debt per borrower in Illinois is $46,000.

LendingTree’s Jacob Channel said borrowers need to start preparing to make those payments now.

“What you should do is log back into your student loan account, say, ‘Okay, here’s how much I owe, here’s how much my monthly payment would be,’ and then try to budget accordingly. of your current income,” Channel said.

The Illinois Attorney General’s Office says loan servicers are required to send consumers a “payment notice” at least 21 days before their next payment is due, which will likely be sometime after the 1st. september.

If borrowers are still struggling to figure out how they’ll pay, Channel says there may be other solutions.

“There are still programs to help people,” Channel explained.

Some of these examples include:

  • Income Oriented Reimbursement Programs: The Department of Education’s Federal Office of Student Aid (FSA) says most federal student loans are eligible for at least one income-based repayment plan. The FSA website states that if a borrower’s income is low enough, their payment could be as low as $0 per month. To learn more about this, click here.
  • Temporary assistance – Adjournment and abstention: If a borrower is in a short-term financial situation, the FSA says they may qualify for a deferral or forbearance. These options will temporarily suspend payments. To learn more, click here.
  • Civil Service Loan Cancellation Program: The PSLF program allows borrowers employed by a government or non-profit organization to have some of their debt forgiven. The program has had problems in the past, but the Ministry of Education said the program has undergone major reforms in the past year. To learn more, click here.

After the Supreme Court ruling last week, President Biden promised to come up with a “plan B” for student loan forgiveness, but details, including who would be eligible and the loan amounts that would be forgiven, are unclear. still under development.

For now, borrowers like Burris are trying to plan ahead.

“I know I’m in a better place, my student loan payment won’t be crazy, but even if I were to pay $200 more a month, I can’t find another $200 a month,” said Burris. “It’s worrying, it’s really worrying.”

Do you have a consumer complaint? Call 1-844-NBC-RESP or click here to let us know so we can help you.

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