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 COVID-19 Information from ACCC

Relief Can Be Had from Private Student Loans Borrowers Impacted by COVID-19

American Consumer Credit Counseling is advising clients on how to navigate student loan relief options available during COVID-19

(Boston, MA) – August 5, 2020 – American Consumer Credit Counseling (ACCC) says Americans facing hardship from private student loans due to  COVID-19 can still find relief – even though most private loans  were left out of the federal CARES Act initiated in March.

“Student loan forbearance can make sense for those struggling with overall household expenses as a result of the pandemic,” said Steve Trumble, President and CEO of American Consumer Credit Counseling. “But it’s still important to think everything through before making a decision to request forbearance, especially with private loans, as interest will still accrue.”

Under the CARES Act, borrowers with federal student loans were relieved of making payments through September 30, 2020 – with interest temporarily set at zero percent. Because private student loans are not covered under the CARES Act, several states came together to create the Multi-State Initiative, which ensures borrows have a 90-day forbearance, no late payment fees, and no negative credit reporting. It also provides relief from debt collection lawsuits, and lenders must work with borrowers to find a relief program that best fits their needs. The states that have established agreements with loan companies under this initiative include California, Colorado, Connecticut, District of Colombia, Illinois, Massachusetts, New Jersey, New York, Vermont, Virginia, Washington, Michigan (limited relief) and Rhode Island (limited relief).

Federal student loan relief:

  • All loan borrowers were automatically placed in administrative forbearance, stopping monthly loan payment bills.
  • Interest is temporarily set at zero percent.
  • If borrowers choose to make payments at this time, payments will be applied to the principal balance once all interest accrued before March 13 is paid off.
  • Payments made between March 13 and September 30 may be refunded by contacting loan servicers.
  • Borrowers may pay more or less than their regular payments during this time.
  • Borrowers may opt-out of administrative forbearance, so autopayments and bills return.

Private student loan relief:

  • Several lenders are offering some type of relief during COVID-19, so it is essential to check the lender’s website or call.
  • Some private lenders offering relief include Nelnet, Navient, Sallie Mae, Discover, SoFi, CommonBond, Earnest, College Ave Loans, and Citizen Bank Student Loans.
  • Several lenders are offering a two- to three-month payment postponement, but those that need more extended assistance may apply for it.
  • During the payment postponement, interest still accrues but is not capitalized at the end of the relief period.
  • Be sure to call your loan service provider to find out what relief program would work best with your financial situation.
  • Be sure to ask questions, so you understand all the terms associated with the relief program.
  • As interest rates drop, borrowers may consider refinancing their private student loans to save money down the road. ACCC can also help loan borrowers explore all options that are available, regardless of how much they owe.

“A good option during forbearance is to pay the amount each month to cover the interest, so when the period is over, the total amount will not increase,” added Trumble. “For federal loans, continuing payments during this time could help the borrows pay their loans off at a faster rate due to the zero percent interest.”

According to ACCC’s recent June Financial Health Index Poll, the number of respondents who are not confident at all in the U.S. economy has risen from 16 percent to 23 percent from March to June. On Thursday, July 23, the U.S. Labor Department announced that 1.4 million people applied for unemployment insurance, an increase of 109,000 from the previous week. It was  the 18th straight week that job loss claims have been higher than 1 million.

About American Consumer Credit Counseling

American Consumer Credit Counseling (ACCC) is a nonprofit credit counseling 501(c)(3) organization dedicated to empowering consumers to achieve financial management through credit counseling, debt management, bankruptcy counseling, housing counseling, student loan counseling, and financial education concerning debt solutions. To help consumers reach their goal of debt relief, ACCC provides a range of free consumer personal finance resources on a variety of topics including budgeting, credit and debt management, student loan assistance, youth and money, homeownership, identity theft, senior living, and retirement. Consumers can use ACCC’s worksheets, videos, calculators, and blog articles to make the best possible decisions regarding their financial future. ACCC holds an A+ rating with the Better Business Bureau and is a member of the National Foundation for Credit Counseling® (NFCC®). For more information or to access free financial education resources, log on to or visit

American Consumer Credit Counseling (ACCC) provides non-profit credit counseling, debt relief, and debt elimination services for consumers nationwide. We offer free credit counseling to help consumers identify the right debt reduction program or debt solution for their unique situation. Since 1991, our certified credit counselors have helped thousands of individuals and families learn how to pay off a credit card balance and how to get out of debt fast through programs designed to payoff credit card debt within five years. Our debt management programs consolidate card credit debt payments and help reduce interest rates and finances charges, reducing the time it takes for getting rid of debt. And we offer comprehensive financial education services where consumers can get answers to questions like "How do I create a budget?", "What is debt consolidation?" and "How can I avoid debt in the future?"

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