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Initially enacted as emergency relief during the COVID-19 pandemic, this pause on interest accrual and mandatory payments has been extended multiple times, creating a complex timeline that borrowers must navigate.

The Current Status

As of the latest update, the freeze on federal student loan interest and the payment pause officially ended. Interest began accruing again on September 1, 2023, and payments resumed in October 2023. This marked the conclusion of the pandemic-era relief that had been in place since March 2020.

However, the Biden administration has implemented significant new measures to soften the transition and provide ongoing support:

To prevent immediate financial shock, the Department of Education instituted a 12-month transition period. During this time, borrowers who miss payments will not be reported as delinquent to credit bureaus, and loans will not be placed in default. It is crucial to understand that interest will still accrue during this period, increasing the total loan balance if payments are not made.

Launched in summer 2023, this new income-driven repayment (IDR) plan offers the most generous terms to date. Key benefits include:
* Raising the income exemption from 150% to 225% of the federal poverty guideline.
* Forgiving any remaining monthly interest that is not covered by the borrower’s payment, preventing balance growth for those making regular payments.
* Offering faster forgiveness timelines for borrowers with original principal balances of ,000 or less.

Key Implications for Borrowers

* Interest is Accumulating: The core “freeze” on interest has ended. Your loan balances are now growing each month by the applicable interest rate unless you are making payments that cover the accruing interest, or you are enrolled in the SAVE plan which may cover the unpaid interest.
* Payments are Due: Scheduled monthly payments have resumed. While the “on-ramp” period offers protection from the worst consequences of non-payment, making payments is strongly advised to avoid increased debt from compounding interest.
* Action is Required: Borrowers should:

to confirm their current balance, interest rate, monthly payment amount, and due date.

with both the Department of Education (via StudentAid.gov) and their loan servicer.

particularly the new SAVE plan, to find an affordable monthly payment. Use the Loan Simulator tool at StudentAid.gov to compare options.

to ensure payments are made on time and to qualify for a 0.25% interest rate reduction.

Looking Ahead

The future of broad student debt cancellation remains uncertain following the Supreme Court’s decision to block the administration’s one-time forgiveness plan. Policy efforts are now focused on creating more sustainable, long-term relief through programs like SAVE and pursuing alternative paths for debt cancellation, such as reforms to existing forgiveness programs for public service workers and borrowers who have been in repayment for 20+ years.

Bottom Line

The era of the blanket student loan interest rate freeze is over. Borrowers are now in a phase of transitional protections with interest accruing. Proactive engagement with your loan servicer and the Department of Education’s resources is essential to manage your debt effectively, minimize long-term costs, and take advantage of new relief programs designed to create a more manageable path forward.

For the most authoritative and up-to-date information, always refer to the official U.S. Department of Education website at [StudentAid.gov](https://studentaid.gov).