Here’s how a gov’t shutdown could impact the student loan repayment process

BOSTON — If you have student loan debt, get ready because the interest is rolling and your first payment is due in October.

But could a government shutdown affect the repayment process?

Betsy Mayotte, founder and president of The Institute of Student Loan Advisors in Plymouth, said no.

“Historically when there’s a government shutdown, the servicers still stay up and running, so payments would still be due,” Mayotte said. “It would have to be a multiple-month shutdown, so it’s extremely unlikely, almost impossible [another pause on payments] would happen.”

However, a shutdown does mean employees at the Education Dept. would no longer be working. Mayotte said that could throw a wrench into the student loan system.

“There are certain things that are run directly by Dept. of Education employees and many of those employees are going to be furloughed,” she said.

Mayotte said that could mean certain things are not processed, like the Public Service Loan Forgiveness Program, the one-time account adjustment known as an IDR Waiver and rollout of the FAFSA Simplification Act.

“I would expect to see delays on those things because those are run directly by Dept. of Education employees,” Mayotte said.

Around 902,000 Massachusetts residents owe a combined $30.8 billion in student loan debt, according to the Education Data Initiative.

“It’s going to take a little while to pay off. That’s for sure,” said 2020 Boston University graduate Colin Tonkiss. “I’m set up [to make repayments in October]. It’s going to be a paycheck-to-paycheck situation, but it is what it is.”

If you owe student loans, here are three things you should do to make sure you’re ready for repayments in October.

This is a developing story. Check back for updates as more information becomes available.

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