What A Government Shutdown Means For Your Student Loans

This is what a government shutdown means for your student loans. Here’s what you need to know. The federal government could shut down this week if Congress doesn’t reach a deal to fund the government. This comes at a time when the U. S. Department of Education recently announced that $2 billion in student loans will be cancelled within weeks. As such, you may be wondering how a government shutdown could affect your student loans, student loan forgiveness and student loan cancellation. Democrats in Congress wants to pass a continuing resolution to fund the government at its current level, while Republicans are threatening to shut down the government over the Biden administration’s proposed vaccine mandates. With funding for the federal government will run out Friday night, Democrats are positioning for a two-month extension, while Republicans want a longer-term funding solution. While a government shutdown could be short-lived, it’s important to understand what a longer shutdown could mean for your student loans. The federal government can shut down temporarily if Congress doesn’t fund the government. To avoid a shutdown of the federal government, Congress must pass a law to fund the federal government each year by October 1, which is the start of the next fiscal year. If Congress doesn’t fund the government beyond October 1, there could be a temporary shutdown of the federal government. If Congress can’t agree on funding for the next fiscal year, Congress can pass one or more short-term funding solutions to keep the federal government open. Democrats and Republicans will need to agree on a funding fix to avoid a government shutdown this weekend, whether it’s another short-term funding plan or a larger appropriations bill. If there is a shutdown, it’s possible that certain federal services and agencies may be temporarily limited. That said, each federal agency develops its own shutdown plan. Essential services such as law enforcement, border protection and government hospitals, for example, have continued to operate during prior shutdowns. (Here’s who qualifies for student loan forgiveness right now). If there is a short-term government shut down, expect little impact to your student loans. Specifically, a government shutdown only affects the federal government. There is no impact to private student loans, for example, and state and local governments will continue to operate. Currently, for your federal student loans, there is temporary student loan forbearance through January 31, 2022. (Prepare for the end of student loan relief). This means that there are no mandatory federal student loan payments and interest rates on federal student loans temporarily are set at 0%. Even with a longer-term government shut down, you should still be able to:The question is whether processing these various requests could be delayed while the federal government is shut down. (Here’s who qualifies for student loan forgiveness right now). All data is taken from the source: http://forbes.com Article Link: https://www.forbes.com/sites/zackfrie... #government #newsoftheday #newstodaybbc #bbcnewsworld #newstodayusa #usanewstoday #