Feds to reverse course on student loan payments

Thank you for that Brianda. It has been five years of pauses and promises and legislation and lawsuits And now the federal government changing course on student loans. Chris Sadeghi is live at UT Dallas this morning as millions of borrowers could soon Face some serious consequences if they don't start paying up. That's right Kara The federal government has a lot of different tools they can use to collect on these federal student loans and today They say they're gonna start using those tools. To understand why this might come as a surprise You have to go all the way back to March of 2020 the beginning of the pandemic and the Trump administration paused federal student loan payments to ease the financial burden of the COVID pandemic Then the Biden administration extended that pause as part of their student loan forgiveness programs So currently there's more than 5 million people who are in default on their student loans That means they have not made a payment in nine months Now the current Trump administration says time is up starting today Those 5 million people could see tax refunds federal salaries and other benefits withheld and after a 30-day notice Their wages could be garnished. We spoke to a CPA who told us student loan borrowers are experiencing Experiencing some whiplash and that's what's got people surprised Shocked almost in disbelief because for five years it's been don't worry about it. Okay, we're gonna enforce it No, we're not. We're gonna forgive it have but you can't do that. And so they've been confused And if you're confused or you're in that situation the Department of Education Recommends going to their website setting up some kind of payment plan or loan rehabilitation Carry back to you. Okay. Thank you, Chris So if you have not started paying back your student loans It is not too late to take control a few steps to get you back on track So you have to figure out what you owe as Chris mentioned You can log into student aid gov to see your balance interest rates and who your servicer is Next choose a repayment plan that works for you some plans base your monthly payment on your income and family size which could mean a lower bill and Consider auto pay it can save you a quarter percent on interest and help you avoid any late fees And if you've fallen behind you can start making it a budget priority now, even small payments can reduce what you owe long-term