COLORADO SPRINGS — Thousands of local graduates and former students now have to pay back student loans. It comes after a three-year pause on borrowers paying federal student loans.
The pause on federal student loans began in March 2020, as part of pandemic-relief measures and was extended several times. However, Congress blocked additional extensions earlier this year.
Jevita Rogers, the assistant vice chancellor for financial aid at UCCS said it’s important to have a plan in place to pay back your student loans and not fall into larger debt. She said she knows many who appreciated the pause on payments.
“Most of the students that I’ve been dealing with and also parents, they have not continued to pay make payments while they were not required to,” said Rogers.
According to Rogers, former students and graduates of UCCS, on average, have about $25,000 in student loan debt. More than 50-thousand student loan borrowers and parent borrowers from the university will resume making monthly student loan payments. Those are anywhere from $100 dollars to about $500.
Monthly payments will depend on what students choose for their repayment option and some people have already started budgeting to afford this monthly payment.
“Set realistic expectations as far as the payment is going to be,” said Rogers. “So it is one of those, budgeting is extremely important.”
Rogers said there are also calculators on the federal student loan website to help, or check out the ‘SAVE repayment plan which is an income-driven payment plan announced by President Biden this summer.
“I always recommend that you sign up for the lowest possible that you think, and if you can pay more, then know that that's going to be a way that you can beat the interest overall, and also pay it off quicker,” said Rogers.
Interest has begun accruing again too. This summer, President Joe Biden also announced a 12-month grace period to help borrowers struggling to resume payments. Borrowers are still encouraged to make payments during this time period, but if you cannot, you won't be at risk of default.
Kelly Harrington graduated in 2018 and has around $40,000 dollars in federal student loan debt.
Like many, she also took a pause on her payments for three years.
“Prices of everything else have changed. So I’ve just never found myself in a position able to make additional or have additional funding to put toward it,” said Harrington.
Former students like her are now making personal changes to begin paying loans back.
“Budgeting and being really aware of my own personal finances in and out and just being able to make sure the funds are there. I mean it's that's all we really can do at this point,” said Harrington.
Loan service providers are there to help. It’s also encouraged to stay in communication with them, to get on a payment plan that works best for you. During this time, also be mindful about callers who could be scammers. Do not give away any identifying personal information.
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