At Laurel Road, we understand the uncertainty and questions that student loan holders may have surrounding the COVID-19 crisis and student loan relief. Our focus is the safety and financial peace of mind for both current and future members. As federal student loan relief plans evolve, we will continue to share information with you as we learn the facts – in the near term and beyond. If you’re an existing Laurel Road member struggling to make payments, please reach out to our servicing partner Mohela for available options.
If you hold federal student loans and are considering refinancing during this time, we encourage you to carefully weigh your options before doing so, including the temporary relief and benefits you will lose in obtaining a new private loan. Click here for more information.
For members with an existing Laurel Road student loan:
Please contact our servicing partner Mohela at (877) 292-6845 (TTY: Dial 711) for questions on your loan account or to inquire about available hardship options.
Our Member Services team is also always here to help – 7 days a week, 7 AM – 11 PM EST.
If you’d like to speak with a Laurel Road Member Services specialist for any other questions or issues you may have, please contact us at 1-833-427-2265 (TDD/TYY: 1-800-539-8336), by email at firstname.lastname@example.org, or by visiting us online.
Beware of Scams During COVID-19
Financial scammers often take advantage of consumers during times of crisis and/or economic uncertainty. Please see our recent blog post for tips on what to look out for to protect yourself from these risks.
Forbearance for those impacted by COVID-19
If you are experiencing an impact to your income as a result of COVID-19, you can request a forbearance of 3 monthly payments. With this COVID-19 forbearance option:
- Your loan’s maturity date will be extended by roughly the number of months of the forbearance period.
- Interest will still accrue but it will not be added to the principal balance of your loan. The repayment of the interest that accrued during the forbearance period and your outstanding principal balance will be re-calculated over the remaining term of your loan to determine your new monthly payment. Your new monthly payment will likely be higher than your original monthly payment because of the interest that accrued during the forbearance period. (Note: If the interest accrued during your COVID-19 hardship forbearance is not paid and you use a different type of forbearance or deferment in the future, the interest could be capitalized at that future time).
- The COVID-19 forbearance will not count against your allowance for economic hardship forbearance under the terms of your loan agreement. Additionally, the COVID-19 forbearance will have no effect on meeting the requirements for cosigner release if available under terms of your loan (e.g., if you had made 30 out of the 36 required consecutive payments immediately prior to entering the COVID-19 forbearance, your 31st payment towards meeting the requirement would be due approximately 1-month after exiting the forbearance).
If you believe you will experience financial hardship beyond this initial forbearance of 3 monthly payments, you have the option to request an additional 3-month COVID-19 forbearance period if your account was current prior to entering into your COVID-19 forbearance and you have not previously used in total 9 months of COVID-19 forbearance. If your loan was delinquent, contact us for other options.
To inquire about this forbearance or other hardship options if needed, please contact MOHELA at 1-877-292-6845 (TTY: Dial 711).
Understanding the Differences Between Federal and Private Loans
To help you understand the implications of refinancing federal loans to private student loans, we’ve created the following table highlighting what would be different, and what would remain the same.
|Federal Student Loan||Laurel Road Refinanced Loan|
|Repayment Terms||Federal loan borrowers choose between repayment plans that offer loan terms from 10 years up to 30 years in length.||Borrowers who refinance a federal student loan into a private loan with Laurel Road may be eligible for loan terms from 5 years up to 20 years in length.1|
|Interest Rate||Standardized interest rate throughout duration of loan, but temporary 0% interest rate offered through Sept. 30, 2021.||New interest rate based on your creditworthiness as a borrower.|
|Income Driven Repayment||Available||Not Available|
|Public Service Loan Forgiveness||Available||Not Available|
|Length of Forbearance||Most Federal student loans’ discretionary general and mandatory forbearance allows for borrowers to request forbearance for up to 12 months at a time. If borrowers continue to meet eligibility requirements when that forbearance expires, they may request another forbearance. General forbearance is limited to no more than 36 months over the life of the loan. You can find out more about these programs on the Federal Loan website.||
Economic hardship: Up to 12 months total of one or more (but not consecutive) 3-month time periods over life of loan. Terms and conditions apply.2
COVID-19 or other natural disaster forbearance: Up to 9 months total of one or more 3-month time periods over life of loan. Does not count against total allowance for general economic hardship forbearance.
|In-school Deferment||Federal loans allow borrowers to defer payments should they return to school as long as they’re at least a half-time student, and with certain subsidized loans, the U.S. Government may pay the interest during the deferment period.||Laurel Road does not offer in-school deferment.|
|Default Timeline||Federal student loans enter default after 270 days of missed payments.||Laurel Road student loans are considered in default after 90 days of missed payments.|
|CARES Act Student Loan Relief||Available. The Federal Government has paused all federal student loan payments and waived interest charges on federally held loans until 9/30/21.||Those refinancing from a Federal loan to a Private loan with Laurel Road will lose federal benefits including the ability to defer payments and incur no interest through September 30, 2021.|
|Grace Period||Federal loan grace periods extend 6 months beyond your graduation date.||Laurel Road honors a 6-month grace period beyond your graduation date.|
|Discharged in the event of permanent disability or death||The Federal government will discharge the loan – for both borrower and cosigner – in the event of permanent disability or death of the borrower.||Laurel Road will discharge the loan – for both borrower and cosigner – in the event of permanent disability or death of the borrower.|
|Eligible for Student Loan Interest Tax deduction||Student loan interest is tax deductible for those who qualify based on their income levels. Consult a tax advisor for more information.||Student loan interest remains tax deductible for those who qualify based on their income levels. Consult a tax advisor for more information.|
|Credit report categorization||Federal loans are categorized as “student loans” on your credit report.||Private loans from Laurel Road are also categorized as a “student loan” on your credit report.|
This information is an overview of the various programs. Please consult studentaid.gov/h/manage-loans for the details about your federal loans and any benefits being offered. For more information regarding Laurel Road’s loan programs and terms visit laurelroad.com/faq.
- Repayment Plans, Finaid.org
- Total and Permanent Disability Discharge, StudentAid.gov
- Topic No. 456 Student Loan Interest Deduction, Internal Revenue Service
- For repayment examples go to laurelroad.com/refinance-student-loans.
- After loan disbursement, if a borrower documents a qualifying economic hardship, we may agree in our discretion to allow for forbearance of payments for one or more 3-month time periods (however, a minimum of twelve (12) months are required between any two forbearance periods). Borrowers with a loan term of at least ten (10) years are eligible for up to twelve (12) months of forbearance over the life of the loan; borrowers with a loan term less than ten (10) years are eligible for one (1) month for every year of the loan term (e.g., if a borrower’s loan term is five (5) years they are eligible for up to five (5) months of forbearance over the life of the loan). Borrowers seeking an economic hardship forbearance due to unemployment must have made twelve (12) consecutive monthly payments prior to a forbearance request to be eligible. For any other forbearance due to economic hardship, borrowers must have made nine (9) consecutive monthly payments prior to a forbearance request to be eligible. All requests for forbearance are subject to review, including the review of acceptable documentation (including updating documentation) of the nature and expected duration of the borrower’s economic hardship. During any period of forbearance, interest will continue to accrue. Unless otherwise noted, at the end of the forbearance period, any unpaid accrued interest will be capitalized and be added to the remaining principal amount of the loan.