DENVER — Starting this Sunday October the 1st, federal student loan payments will start back up for thousands of Coloradans after a three-year pause.
Denver7 got the chance to speak with a Colorado-based student loan lawyer who explained what this means for borrowers, and the options you have ahead of the payment restart date.
Student loan lawyer Karen Cody-Hopkins explained now is the time to look at different payment options available to you and to call your loan company to see if they can make accommodations to help you out if you can't make your payments. The student loan lawyer said the studentaid.gov website is where you need to research all the payment options open to you.
Cody-Hopkins said to get on the website to do some digging to find out what loan you have because some repayment options could lead to forgiveness.
When it comes down to repayment options you should sign up for an income driven re-payment plan option that will based on your monthly payment off of your income reported to the IRS last year.
She shared your student loans will not go away unless you die or pay them off so now is the time to try and figure out a plan. For some people these payments are an added bill and that can complicate financial situations when you are already on a budget.
Cody-Hopkins has this advice for you, "Well, you have to keep digging to see, first of all, you may have only been told about one repayment plan, well learn about all of them. And they have nuances," she said. "For example, your fight your tax filing status, married filing single or joint can affect what your income is, because you'd have to report that, well, if you change your tax filing status, you may be able to get a much cheaper repayment plan. Or you may be able to get a short-term deferment or forbearance while you kind of regroup as to how you're going to make these payments".
If you don't make the payments, Hopkins says there will not be any implications until September of 2024 at the earliest. Keep in mind not making a payment means a year of accumulated interest added on to your already existing loan. If you do not make a payment beyond September of 2024, your paycheck, tax refund check, or even social security check can be garnished for those funds owed to the government.