Episode 20: Student Loan Interest Reduction

KEY TAKEAWAYS:

  • Student loan forbearance was issued through September during the current pandemic, but has been extended through 2021.
  • The federal forbearance means you do not need to pay your student loan – and won’t accrue any interest – but as Lisa mentions in a previous FWW, this may be a great time to get ahead on your loans if you have the means in your budget to keep making payments.
  • There may be a way to lower your federal student loan interest rate after the forbearance is up.
  • If your loan is through a private lender, reach out and see what they can offer you!
  • To start qualifying, be sure to stay up on payments on time.
  • Other qualifying factors for federal interest rate reductions are;
    • You must have paid your interest payments for the last year.
    • If married, you must have filed married joint and neither of you are claimed as a dependent of someone else.
    • Your modified adjusted gross income must be less than the specified amount set.
      • Your set payment on your loan fluctuates based on your income – so in theory you would earn more over time and will be able to afford a larger payment
  • Search topic #456 on the IRS website to learn more, or click here.
  • GHS is always here for you! Stop in to a branch or call us if you need us at (800) 732-4447.