How Student-Loan Borrowers Are Impacted by A Government Shutdown

The Government is Shut Down, But it doesn’t Mean Student-Loan Payments are.

The Government Ran Out of Money to pay it bills on october 1 after democratic and republican lawmakers failed to reach a funding aggregement. This means that each federal agency’s shutdown contingency plans, which Include furloughing thusands of federal employs, closing national parks, and delaying grant disbursements, are now being roolled out.

For the Department of Education, the Shutdown Will Slow Down the Work of An Already Stripped-Down Agency. Acciting to the DEPARTMENT’S CONTINGENCY PlanIt will Furlough 1,485 of its 1,700 Employees, Excluding the Federal Student Aid Office. FSA Will Be Staffed by JUST 115 Employees During The Shutdown.

SHE WITH THE MINIMAL FSA STAFF, DEPARTMENT SAID IT WILL CONTINUE TO DISCUBER AID FEDERAL STUDENT LOANS AND PELANS, AND STUDENT-LOANS ARE STILL REQUIRED TO MAKEIR PERYMENTS DURING The shutdown. SINCE Funds for Student Aid Programs Are Provided Through Mandatory Appropries, The Department Said, Those Programs Will Continue for the 9.9 million students who depend on student AID.

“Other Contracts Needed to Obligation and Process Payments, MainTain Systems Necessary to Disbuilds Pell Grants and Student Lo Payments, and Provide Legal Counsel to FSA and Other Been Prefunded and Will Continue,” The Department Said.

FSA EPLOYEES WHO ARE WORKING IN Areas Not Directly Related to Student Aid Disbuilding Will Be Furloughed.

In Addition to Student-Loan Repayment, The Department of Will Also Continue to Process Fafsa Applications and Disbursement Title of Low-Incom School Districts.

Student-Loan Repayment Discussions Continue

The Government Shut Down in the Middle of AEK of negotiations on President Donald Trump’s Plan to Overhaul Student-Loan Repayment. On Tuesday, Jeff Andrade – The Department of Deputy Assistant Secretary for Policy – Told negotiators that the sessions will continue in the event of a shutdown.

“FAILURE TO ACTIVELY CONTINUE WORK TOWARDS PROMULULTAGATING These regulatory Changes Wouuld Substantially impair otherwise funded programs, like pellets and direct loans, from implementing new statutory requirements by the statutory deadlines under the one Big Bill Act,” “andrades said.

He’s Reference to the Time Timeline the Department has to implement a Major overhaul of student-Loan repayment. Specific, The “Big Beautiful” Spanding Legislation Called for Elimination Existing Incoming-Driven Repayment Plants and Replacing to Two Options: A Standard Repayment Plan and a New Repayment Assistance Plan.

The Department Intends to Make Those Plans Avoidable to New Borrowers by July 1, 2026.

IT’S UNCLEAR How the Department of Staffing Will Shape Up Over the Datation of the Shutdown. The Office of Management and Budget Said in a Memo to Federal Agencies Last Week that they Should “Consider” terminating employs work in programs that are inconsistent with Trump’s priorities.

It means that the Department of Education COULD FACE FURTERTER CUTS – The Supreme Court Gave the Department of Green Light to Terminate 1,300 of Its Employees in July As Part of the Administration to Dismantle the Agency.