Are Your Student Loans Protected by the CARES Act?

The CARES Act was first passed by President Trump on March 27, 2020 with the intention to assist people with student loans. It has been extended three times since, with President Biden extending its protection through September 30, 2021. But what does it really protect? The CARES act reduces interest rates to 0%, stops wage garnishments and collection attempts if you are in default and suspends your need to make a payment if your loan qualifies. This last point is the most important because not all student loans actually qualify.

What loans qualify for protection under the CARES Act?

According to, only federal student loans held by the Department of Education are addressed. This very specific definition is important because all Perkins loans and some Stafford/FFEL loans are not always covered, especially if you are in good standing with the loan and are paying on time. In fact, you may not receive any benefit from CARES and must continue paying these loans even while other loan payments are suspended. Some federal student loans are subsidized by the federal government but are not owned by the federal government and that is the major difference as to which loans are covered by CARES.

Are there exceptions to which loans are protected by the CARES Act?

Although the CARES Act attempts to clearly define which loans are included, there are several exceptions. Some loans can become federal owned loans based on your status, the status of the loan itself or other circumstances. Understanding this information, how it applies to your loan and what it means in the end is best accomplished with the help of a trained student loan lawyer. Making a mistake can cost you dearly with a severe negative affect occurring as soon as the CARES Act expires or even sooner.

How does a student loan lawyer help me?

A properly trained student loan lawyer understands the specific circumstances of the loan cycle and can provide you with both an understanding of your loan status and strategies you can implement during and after the CARES Act expires. Knowing how to position your loans now can make it easier to plan your finances, avoid collections and ease any stress you have on this topic. Contact me today to set up an analysis of your student loans so you are prepared and do not get stuck in the middle when CARES expires.