Federal student loan borrowers will have until the end of the year, instead of the end of this month, to enroll in autopay for a hefty discount on their debt, the Education Department said Tuesday.
People who opt to have their student loan payments automatically withdrawn from their bank accounts now qualify for a one-percentage-point discount on the interest rate, up from the standard 0.25 percentage point. The higher discount, which the department launched in June, could save borrowers hundreds or thousands of dollars over the life of a student loan.
The discount ends June 30, 2028, and is available to people who borrowed on or after July 2012. People in default on their student loans must consolidate the debt and then apply for a new repayment plan before enrolling in autopay.
The extension arrives a day before the department was slated to end the enrollment period. The Education Department said nearly 2 million people have signed up for autopay since it announced the rate reduction this summer.
The temporary discount is designed to drive up student loan repayment rates as the Education Department contends with stubbornly high rates of late payments and full-fledged defaults. More than 9.3 million borrowers haven’t made a payment on their loans in at least 360 days, while an additional 3.5 million are at least 30 days delinquent, according to the department.
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The post Student loan borrowers get more time to enroll in autopay for a debt discount appeared first on Washington Post.
