The federal CARES Act provides much needed relief for many borrowers with student loans, including the suspension of monthly payments, interest, and involuntary collection activity until Sept. 30, 2020. However, the CARES Act left out millions of student loan borrowers with federal loans that are not owned by the U.S. government as well as loans made by private lenders.
“During the COVID-19 crisis, many student loan borrowers are struggling financially and need relief, regardless of who owns their loan. I am pleased that several states and student loan servicers have come together to provide relief to more borrowers,” said Weiser. “We all need to do our part to provide grace to those who are struggling, and I applaud these student loan servicers for stepping up.”
Under this initiative, Coloradans with commercially held Federal Family Education Loans Program (FFELP) loans or private student loans who are struggling to make their payments due to the COVID-19 pandemic will be eligible for expanded relief. Borrowers in need of assistance should contact their loan servicer to identify the options that are appropriate to their circumstances. Relief options include providing a minimum of 90 days of forbearance; waiving late payment fees; ensuring that no borrower is subject to negative credit reporting; ceasing debt collection lawsuits for 90 days; and working with borrower to enroll them in other assistance programs, such as income driven repayment plans.
If regulated student loan servicers are limited in their ability to take these actions due to investor restrictions or contractual obligations, servicers are committed to working proactively with loan holders whenever possible to relax those restrictions or obligations. Servicers who take reasonable actions to support relief for borrowers during the pandemic will not be subject to state regulatory action.
Student loan servicers participating in the initiative include: Aspire Resources, Inc., College Ave Student Loan Servicing, LLC, Earnest Operations, LLC, Edfinancial Services, LLC, Kentucky Higher Education Student Loan Corporation, Lendkey Technologies, Inc., Higher Education Loan Authority of the State of Missouri (MOHELA), Navient Corp., Nelnet, Inc., SoFi Lending Corp., Tuition Options, LLC, Utah Higher Education Assistance Authority (UHEAA), Vermont Student Assistance Corporation (VSAC).
Weiser’s office worked with other states to launch this initiative. Other states include California, Connecticut, Illinois, New Jersey, Massachusetts, Vermont, Virginia, and Washington.