Fire Engulfs Home as Eaton Fire Moves Through Area, Raising Concerns for Student Loan Borrowers
Federal student loan borrowers affected by the recent wildfires in Southern California may be eligible for temporary relief from their payments. The same relief options are available to those affected by other natural disasters, such as hurricanes, tornadoes, and droughts.
According to Carolina Rodriguez, director of the Education Debt Consumer Assistance Program, borrowers impacted by natural disasters may qualify for temporary relief from student loan payments. Experts recommend that borrowers familiarize themselves with the relief available to them in case they need it.
A record number of billion-dollar disasters occurred in the US in 2023, including wildfires, droughts, and tornadoes. In 2024, there were 24 confirmed weather and climate disaster events with losses exceeding $1 billion each.
The Heroes Act of 2003 provides relief to certain student loan borrowers who live in or are employed in an area affected by a natural disaster. A natural disaster forbearance can last up to 90 days, with 30-day extensions possible. However, the forbearance cannot exceed 12 monthly billing cycles from the date of the disaster.
Borrowers who are students at the time of a natural disaster may continue to qualify for an in-school deferment. Those who are in default on their student loans can request a three-month suspension of collection activity.
Documentation may not be necessary to verify eligibility for the forbearance, and borrowers can request the suspension orally rather than in writing. If borrowers have lost their student loan records in a disaster, they can access the information through their Studentaid.gov account.
Ineligible borrowers may be able to request a temporary payment pause by applying for a general forbearance with their servicer. However, interest can continue to accrue on their debt during a forbearance, and they may not get credit toward a debt forgiveness program while not making payments.
Borrowers with private student loans may have fewer disaster relief options, but it is essential to reach out to private lenders as soon as possible to explore available relief and prevent delinquency or default.