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Financial Services Law Insights and Observations

CFPB issues guidance to student loan borrowers on Covid-19 debt relief

Federal Issues Agency Rule-Making & Guidance Student Lending Debt Relief Consumer Finance Covid-19 CFPB CARES Act Federal Legislation

Federal Issues

On March 27, the CFPB issued guidance on the student loan provisions of the Coronavirus Aid, Relief, and Economic Security (CARES) Act. Pursuant to the Act, borrowers with federally held student loans will automatically have their loan principal and interest payments paused until September 30. Borrowers do not need to take any action to have their payments suspended and interest will not accrue during this period. The CFPB also provided additional guidance on the impact on privately held student loans and federal loans held by commercial lenders, and provided information to help borrowers avoid student loan debt relief scams.

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