The government might shut down, but you still have to make student loan payments

A government shutdown would happen on Sunday, Oct. 1 - the same day as federal student loan repayments are set to begin

No matter what happens in Congress, the Biden administration says student loan collection will continue.

Whether or not the government shuts down, student loan borrowers will still be on the hook.

In the midst of a congressional spending bill standoff, the country is on the verge of another government shutdown that would begin on Sunday, the day student loan repayments are set to begin. But while Congress debates how to fund the federal budget, officials in the Biden administration are saying that no matter what happens, it will begin collecting on student loans.

“Even if extreme House Republicans needlessly shut down the government, loan payments will continue to be due starting [in October],” a spokesperson for the Department of Education told Campus Reform. The spokesperson added that key activities at Federal Student Aid will continue “for a couple of weeks,” but “a prolonged shutdown lasting more than a few weeks could substantially disrupt the return to repayment effort and long-term servicing support for borrowers.”

”When it comes to student loans, our top priority is to support borrowers and give them breathing room on their monthly payments,” the spokesperson added.

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“If this happens, if Republicans in Congress go down this road of shutting down the government, we anticipate that key activities at Federal Student Aid will continue for a couple of weeks,” White House Press Secretary Karine Jean-Pierre said during the White House press briefing on Sept. 25. “But, however, if it is a prolonged shutdown lasting more than a few weeks, it could substantially disrupt the return to repayment effort and long-term serving — servicing support for borrowers.”

Jean-Pierre said the Department of Education would “do its best to support borrowers as return to repayment.” But a prolonged shutdown “could be disruptive,” she added. 

CNBC notes that most federal student loans are managed by outside servicers, and those servicers can continue to function without the Department’s help. Furthermore, the loans are paid out with mandatory federal funds, which are not impacted by a shutdown. 

The only things that will be stopped are changes to repayment plans and loan forgiveness through the Public Service Loan Forgiveness plan, which forgives the debts of individuals who work in the government.

Some 28 million borrowers are expected to restart payments in October, Politico reported. Interest began accruing on loans on Sept. 1 after Congress included a provision terminating the pause on interest in the debt ceiling bill in May, Politico reported at the time. 

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The Department of Education also said at the time that student loan repayment would resume 60 days after the Supreme Court ruled on the Biden administration’s student debt forgiveness plan, or June 30, whichever came first. The Supreme Court ruled against the plan on June 30.

Campus Reform reached out to the Department of Education for comment. This article will be updated accordingly.