Student loan repayment has been paused since March 2020.
Graduates who paid on their loans during the pause can get a refund.
How can I get a refund?
Student loan payments and interest accruals have been paused for over two years. The pause will remain at least until May 1. Out of the more than 43 million student borrowers, less than 20% made payments during the pause. Click here for more information.
Requesting a refund is pretty simple. You’ll have to make a list of any payments you’ve made since the pause. Be sure to include how much you paid and the date each transaction was processed.
The refund request will need to be directed to your loan servicer, not the Department of Education.
You can confirm your loan servicer(s) by logging onto your Federal Student Aid account and selecting “My Loan Servicers” on the account dashboard.
Most servicers request a phone call to process a refund, but the COVID-19 page on your servicers website should offer more specific information.
If you do request a refund, specify which payments you want refunded and ask for a timeline for when you’ll get it.
Refunds are available on federal student loans. If you borrow through a private company, reach out to get information on relief options.
The amount of the refund will depend on how much you paid. As of right now, there is no deadline for requesting a refund.
Is it a good idea to get a refund?
Just because you can get some money back, doesn’t necessarily mean that you should. If you are financially worse off than you were when you made the payments, consider getting some cash back.
Student loan repayments are paused until May 1. However, there is some talk of extending the pause.
Refunds on past payments can help to cover short term expenses like bills. Or they can be good to help rebuild the savings you had to dip into during the pandemic.
Keep in mind that the refund isn’t immediate, it’ll take about a month before you get your hands on it.
If you’re doing alright financially, maybe requesting a refund isn’t in your best interest.
Because student loans are not accruing interest right now, the payments you’ve made, have made a bigger impact. Without interest, your payment goes directly toward the loan principal. That is, if you’ve already paid the debt that accrued before March 2020.