The CARES Act and Student Loans

At a time when so much is uncertain, the last thing you want to be stressing about is your student loans. Luckily, WKU’s Center for Financial Success is here to help you. The newest federal law, the CARES Act, passed to aid those affected by the COVID-19 pandemic contains many provisions that may affect you. Below are some answers to questions that you may be having about student loans, but feel free to contact us to talk about your unique situation. 

For a quick crash course in student loans, refer to:

What loans are included in the CARES Act?

All federal loans (loans owned by the Department of Education) are included. This contains Federal Perkins Loans, Direct Loans, and Federal Family Education Loan (FFEL) Program loans (except those owned by private lenders). Perkins Loans that are owned by your university are also not included. Private loans are NOT included. 

What exactly does the CARES Act mean for me?

If you have student loans that are included in the CARES Act then your payments are temporarily suspended and your interest isn’t accruing from March 13th to September 30th. 

How can I take advantage of paying my student loans since there is no interest accruing?

If you have public student loans, you can take advantage of this time by making a plan to pay down the loans if you are financially able. Once you pay all interest up to March 13th, any additional payments will be applied to the principal. 

Can I get a refund if I made a payment during March?

Yes, you can get a refund for any payments made after March 13th. To request your refund, contact your loan servicer. 

What does this mean if I’m on an income-driven repayment (IRD) plan?

Your suspended payments will count toward the IDR forgiveness. 

What should I do if I have private student loans?

You should still contact your servicer and see if they are offering any sort of payment or interest assistance. Be cautious of any third-party offering assistance as this could be a scam! 

How can I take advantage of the CARES Act if my loans are in default?

If you have defaulted on your loans, it is important to get a plan in place to begin repayment. Now is an excellent time to do that! 

You have two options- consolidation and rehabilitation. To see the differences, click here. There are a few major distinctions between the two plans. Loan rehabilitation can take a few months to get enrolled in, but it removes the record of default from your credit history. Loan consolidation is a much quicker process, but the payment plans for loan consolidation have limitations. There are very specific requirements for both processes. To find out which way to get out of default is best for your situation, talk to one of our coaches.

For those involved in the loan rehabilitation process, the CARES Act allows the temporarily suspended payments to still count as if you were making payments. In order to get out of default for loan rehabilitation, you must make 9 consecutive payments in the amount and time agreed upon for your situation. The six months (March 13th to September 30th) act as if you made payments under the new law. This is great news for those already in the process, but this provision of the act offers an incentive to begin the process of getting rid of those student loans now!

Still have questions? Visit or email to get in contact with one of our financial coaches. We are here to help you during this difficult time!

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