Student Loans: A Timeline of Actions Taken in Light of the COVID-19 Pandemic (IF12136, Version 2, Updated August 25, 2022)
Summary
Version 2 of a Congressional Research Service timeline, IF12136, updated August 25, 2022 and written by Alexandra Hegji, of actions lawmakers and the Department of Education (ED) took for federal student loan borrowers during the COVID-19 national emergency. It traces the suspension of interest accrual, monthly payments and involuntary collections and ED's repeated extensions, ending with what ED called a final extension through December 31, 2022. The newest entry, for August 24, 2022, records ED's plan to cancel up to $10,000 per borrower whose annual income during the pandemic was less than $125,000, with an additional $10,000 for those who received a Pell Grant. ED expected about 20 million borrowers to have their full outstanding balance cancelled. As of August 2022, more than 175,000 borrowers had qualified for forgiveness benefits totaling $10 billion under the PSLF Limited Waiver.
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Updated August 25, 2022
Student Loans: A Timeline of Actions Taken in Light of the
COVID-19 Pandemic
Since the onset of the COVID-19 national emergency, Loan Relief
lawmakers and the U.S. Department of Education (ED) The following timeline provides information on selected
have made available various types of relief for federal actions taken by lawmakers and ED to provide relief to
student loan borrowers. For most borrowers, these include federal student loan borrowers during, and at least in part
the suspension of (1) interest accrual, (2) the requirement due to, the COVID-19 national emergency. The timeline
that borrowers make monthly payments on their loans, and focuses on relief that primarily addresses ED-held student
(3) involuntary collections activities, as well as waivers of loans. During the COVID-19 national emergency, ED has
requirements to qualify for various student loan forgiveness taken other student-loan related actions that are seemingly
or discharge benefits and the creation of a new broad-based unrelated to the COVID-19 pandemic. Only administrative
loan cancellation policy. While Congress authorized a actions for which ED has explicitly referenced the COVID-
subset of these changes for a temporary period, ED has 19 pandemic are included in the timeline below.
extended some of them numerous times since their initial
expiration and has effectuated others. For an in-depth description of relief available to federal
student loan borrowers in light of the COVID-19 pandemic,
This In Focus provides an overview of the Higher see CRS Report R46314, Federal Student Loan Debt Relief
Education Act (HEA; P.L. 89-329, as amended) Title IV in the Context of COVID-19.
federal student loan programs affected by the COVID-19
pandemic-related relief and a timeline of actions taken by 2020
lawmakers or ED authorizing, effectuating, or extending
such relief.
March 20, 2020: ED announced that all borrowers of
ED-held loans would automatically have their interest
rate set to 0% for at least 60 days; each borrower would
HEA Student Loans have the option to suspend their payments for at least
HEA Title IV authorizes the operation of three federal
two months; and borrowers who were more than 31 days
student loan programs: the Direct Loan program, the
delinquent on their loans as of March 13, 2020 (or who
Federal Family Education Loan (FFEL) program, and the
became more than 31 days delinquent thereafter) would
Federal Perkins Loan program. New loans are currently
automatically have their payments suspended.
authorized to be made only through the Direct Loan
program. Previously made FFEL and Perkins Loans remain March 27, 2020: Congress and the President enacted the
outstanding, and borrowers remain responsible for repaying Coronavirus Aid, Relief, and Economic Security Act
them. Approximately $1.6 trillion in HEA Title IV loans, (the CARES Act; P.L. 116-136). The CARES Act
owed by about 45 million borrowers is outstanding. suspended interest accrual, monthly loan payments, and
involuntary collections on Direct Loan program loans
Direct Loan program loans are held by ED. As of and ED-held FFEL program loans through September
March 31, 2022, about $1.4 trillion in these loans, 30, 2020. It also specified that suspended payments
borrowed by or on behalf of 37.1 million individuals, were to count toward the 120 monthly payments
was outstanding. required under the Public Service Loan Forgiveness
(PSLF) program, toward the 20- or 25-year repayment
FFEL program loans may be held by private lenders, periods under the income-driven repayment (IDR) plans,
guaranty agencies (GAs), or ED. As of March 31, 2022,
and toward the nine voluntary payments required for
about $113.6 billion in these loans was held by private
individuals to rehabilitate their defaulted loans. Soon
lenders, representing debt for about 4.3 million
thereafter, ED specified that these policies would apply
borrowers; $25.3 billion was held by GAs, representing
to ED-held Perkins Loans.
debt for about 1.1 million borrowers; and about $80
billion was held by ED, representing debt for between
2.7 million and 5.3 million borrowers.
August 21, 2020: ED announced, in accordance with a
Presidential Memorandum dated August 8, 2020, an
Perkins Loan program loans may be held by extension of the interest, payment, and collections
institutions of higher education (IHEs) or ED. As of suspensions through December 31, 2020.
September 23, 2021, IHEs held about $3.4 billion,
representing debt for about 1.2 million borrowers, and
December 4, 2020: ED announced an extension of the
interest, payment, and collections suspensions through
ED held nearly $1.1 billion, representing debt owed by
January 31, 2021.
about 358,000 borrowers.
https://crsreports.congress.gov
Student Loans: A Timeline of Actions Taken in Light of the COVID-19 Pandemic
2021 a result of the waiver; more than 1 million borrowers
have received additional PSLF payment credit.
January 21, 2021: ED announced an extension of the
interest, payment, and collections suspensions through December 22, 2021: ED announced an extension of the
September 30, 2021. interest, payment, and collections suspensions through
May 1, 2022.
March 29, 2021: ED announced a suspension, through
the end of the COVID-19 emergency, of the requirement 2022
that certain borrowers who received a Total and
Permanent Disability (TPD) discharge provide April 6, 2022: ED announced an extension of the
interest, payment, and collections suspensions through
subsequent earnings documentation in accordance with
August 31, 2022. ED also announced that “all borrowers
the three-year post-TPD monitoring period. ED also
announced that TPD loan discharges would be restored with paused loans” will receive a “fresh start on
repayment by eliminating the impacts of delinquency
for borrowers whose loans were reinstated because they
and default and allowing them to reenter repayment in
did not submit such earnings documentation between
March 13, 2020, and the end of the COVID-19 good standing.”
emergency. ED estimated more than 41,000 borrowers April 19, 2022: ED announced the establishment of IDR
who had $1.3 billion in loans reinstated would have plan account adjustments to provide credit toward loan
their discharge restored and that 190,000 borrowers in forgiveness. Specifically, ED will conduct a one-time
their three-year monitoring period would not be required revision to the accounts of borrowers with Direct Loan
to submit earnings documentation. and ED-held FFEL program loans. Borrowers are to
March 30, 2021: ED announced the suspension of receive credit toward the IDR plan loan forgiveness
period for any months in which they had time in
interest accrual and involuntary collections on GA-held
repayment status, “regardless of payments made, loan
FFEL program loans, retroactive to March 13, 2020. ED
also announced the transfer of some GA-held FFEL type, or repayment plan”; 12 or more months of
consecutive forbearance or 36 or more months of
program loans that defaulted on or after March 13, 2020,
cumulative forbearance; months spent in deferment
to ED and the placement of such loans in good standing.
In effect, this ensured that the transferred loans would (excluding in-school deferment) prior to 2013; and any
time in repayment prior to consolidation. Borrowers
be considered held by ED and subject to the interest,
with loans that have accumulated time in repayment for
payments, and collections suspensions, retroactive to
March 13, 2020. ED estimated that up to 1.14 million 20 or 25 years will receive automatic loan forgiveness,
even if they are not currently enrolled in an IDR plan.
borrowers would be affected by this action.
Borrowers with FFEL program loans not held by ED
August 6, 2021: ED announced an extension of the may qualify for the account adjustment by consolidating
interest, payment, and collections suspensions through their loans into the Direct Loan program before ED
January 31, 2022. completes implementation of the changes, which ED
estimates will be no sooner than January 1, 2023.
August 19, 2021: ED announced an indefinite extension Account adjustments will also apply toward the 120
of the suspension of the requirement that certain
monthly payments required for PSLF.
borrowers who received a TPD discharge provide
subsequent earnings documentation. While ED did not ED estimated several thousand borrowers would receive
specifically reference COVID-19 in making this
immediate IDR plan loan forgiveness, more than 3.6
announcement, it extends the policy announced March
million borrowers would receive at least three years of
29, 2021, for which ED did reference COVID-19. additional progress toward IDR plan loan forgiveness,
October 6, 2021: ED announced the establishment of the and over 40,000 borrowers would receive immediate
PSLF Limited Waiver. Under the waiver, through PSLF program forgiveness under these changes.
October 31, 2022, borrowers may receive PSLF August 24, 2022: ED announced it would cancel up to
payment credit for, among others, periods of repayment
(1) $10,000 per borrower whose annual income during
on Direct Loan, FFEL, and Perkins Loan program loans,
the pandemic was less than $125,000 (for individuals) or
regardless of whether payments were made according to less than $250,000 for married couples or heads of
a nonqualifying repayment plan, late, for less than the
household, and (2) an additional $10,000 for those
amount due, or prior to consolidation into the Direct
borrowers who meet the above criteria and received a
Loan program. Borrowers with loans not made under the Pell Grant at any point. ED estimated that up to 43
Direct Loan program must apply to consolidate their
million borrowers would receive some amount of loan
loan(s) into the Direct Loan program by October 31,
cancellation, with about 27 million eligible to receive up
2022, to receive payment credit. Borrowers may also to $20,000 in cancellation benefits, and about 20 million
receive PSLF payment credit for periods of economic
having their full outstanding loan balance cancelled.
hardship deferment on or after January 1, 2013; military
service deferment; or forbearance for active military ED also announced a “final” extension of the interest,
state duty or military mobilization. payment, and collections suspensions through December
31, 2022.
As of August 2022, more than 175,000 borrowers have
qualified for forgiveness benefits totaling $10 billion as Alexandra Hegji, Analyst in Social Policy
IF12136
https://crsreports.congress.gov
Student Loans: A Timeline of Actions Taken in Light of the COVID-19 Pandemic
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