Student loan payment resume for thousands of Oregonians
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Illustration: Annelise Capossela/Axios
Many Oregonians with student loan debt will soon need to resume their monthly payments, following a three-year pause.
Driving the news: While interest on student loans started back up earlier this month, payments are set to be due beginning Oct. 1 — marking an end to the COVID-era relief put in place in 2020.
- Many of the readers who responded to Axios Portland's survey this week said the forbearance offered them flexibility to save money, pay off other debts, make big purchases (like cars and homes), as well as "cushion the impact of rising costs" of groceries, gas and housing.
Why it matters: For millions of people, the resumption of student loan payments will result in real and potentially painful spending cuts.
- Those cuts could also translate to a slowdown for the economy overall, Axios' Emily Peck writes.
Yes, but: Some economists say the end of the reprieve won't reduce consumer spending enough to impact the larger economy as some feared.
By the numbers: Nearly 548,000 Oregonians have federal student loan debt that totals more than $20.5 billion, according to Department of Education data.
- Borrowers here owe an average of $37,900, per the Oregon State Treasury.
- 47% of borrowers are under the age of 35.
State of play: Over the last three years, the median tuition cost to attend a four-year college within the Portland metro area went up over 8% — from $30,960 in 2018-19 to $33,665 in 2021-22, according to the National Center for Education Statistics.
What you're saying: The reintroduction of student loan payments for some Axios Portland readers means they'll have to drastically cut down on day-to-day living expenses and recreational purchases.
- Reader Anna F. said she will no longer be able to help her children financially if they need it or go on "big" vacations.
- For Savannah T., her nearly $1,000 monthly payment means she "will have to delay buying a home."
- Respondents also mentioned qualifying for the Biden administration's new repayment plan, the Saving on a Valuable Education Plan (SAVE), which takes both income and family size into consideration — often resulting in a lower monthly payment.
But even with that, readers expressed concern over the potential inability to save money moving forward.
- "I've learned to live very frugally," one reader wrote. "I will just stress knowing that my loans may loom forever because I don't make enough money to ever pay them off."
What's next: Borrowers worried about not being able to make payments right away can take advantage of the new year-long "on-ramp period" where borrowers won't be reported as defaulting to the national credit rating agencies over missed payments.
Be smart: Use this Axios explainer to figure out your student loan status before payments resume.
- Borrowers can also calculate their repayment with Federal Student Aid's loan simulator.