You now have until January 31, 2022 before you must start repaying student loans — here's how to prepare

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On August 6, 2021, the Biden Administration enacted a second extension of the pause on student loan repayment, interest, and collections until January 31, 2022. The U.S. Department of Education confirmed that this will be the final opportunity for more than 40,000 borrowers to delay making payments.

If you graduated from film school with loans or expect to leave with student loan debt, don’t wait until next spring to make a plan. Here's how you can take advantage of the next six months to reduce your student loan debt total or even eliminate your loans.

The first steps every film school student needs to take

To start, check your inbox. You should have already received a notification from your loan servicer about Biden’s extension. If not, expect to receive a notification this week.

Next, calculate the exact or estimated amount you’ll owe by or after January 31, 2022 by contacting your university’s financial aid office or loan servicer. If you've already taken out or plan to take out unsubsidized loans, which accrue interest daily at a higher rate (currently 5.28%), making payments while you're still in school will reduce your debt.

Let’s say you took out $20,000 in unsubsidized loans this fall for the remainder of your graduate film school program. If you choose to wait to make payments until the federal forbearance is reversed on January 31, 2022, an annual interest rate of 5.28% translates to a daily interest rate of 0.014%, or $2.80 in interest per day. Within the next 6 months, you would pay about $500 in interest. You can use Sallie Mae's student loan interest calculator to figure out how the interest rate will impact your finances.

Subsidized loans are only available to undergraduate students and accrue less interest per day (currently 3.73%). If your parent or guardian took out a Direct PLUS loan on your behalf, be sure to include them in your financial planning.

Solutions for student loan debt — repayment, deferment, and more


If you’re wondering how to get out of student loan debt without paying, it isn’t impossible. But financial freedom comes with drawbacks and costs. You have three options for temporarily halting, reducing, or — in rarer circumstances — wiping away your student loans:

1. Public Student loan Forgiveness (PSLF)


You probably didn't go to film school with the intention of being employed by a U.S. federal, state, local, or tribal government or non-profit organization. But if you've accumulated excessive debt during the pandemic and expect you won't be able to catch up, the PSLF program offers student loan forgiveness after 120 payments (10 years of employment). The most viable option for film school graduate students? Working for a public college or university. Teaching film studies is an excellent way to hone your own craft, so try the PSLF Help tool to determine if your institution of choice qualifies.

2. Deferring your loans


Deferral is often a last resort for student loan debt. But it's a realistic option if you have competing loans (i.e., unforeseen medical bills), can't participate in the PSLF program, or won't be able to meet your minimum student loan payments per month.

How much student loan debt is too much? Get in touch with your university's financial aid office to determine if your monthly payments exceed what you currently earn or anticipate you’ll earn post-graduation. Be mindful that deferred student loans continue to accrue interest at the designated annual rate. If you have a federal Perkins loan, you might be able to qualify for an interest-free deferment.

3. Discharging (eliminating) your loans


For most film school students, things have drastically changed since the pandemic began in March 2020. If your parent or guardian passed away from COVID-19 or related complications, contracting COVID-19 resulted in a temporary or permanent disability, or the holder of your loans suffered catastrophic economic losses, you may be able to wipe away your loans. Death, bankruptcy, and disability may qualify you to discharge your loans. Learn more about the difference between student loan forgiveness vs. being discharged on studentaid.gov.

Additional ways to plan for student loan repayment

Even inexpensive film schools are still a financial investment. The economy is slowly recovering from the pandemic, and many film school students are struggling to find consistent part-time or freelance opportunities...if they're allowed to work at all. Now is the perfect time to focus your efforts instead on applying for grants and scholarships for film school students.

All you need to do is complete the Federal student financial aid form (FAFSA) and submit your application and supporting materials on or before the deadline. If you or your parent or guardian became unemployed or suffered financial setbacks from COVID-19, updating the FAFSA will also help you avoid more debt by making you eligible for additional federal aid. You might also connect with other students who have found innovative ways in COVID-19 to tackle their debt with scholarships, grants, contests, and networking on the FilmSchool.org forums.

If you enjoyed this article, please consider supporting this AD FREE and 100% community supported site. Supporting Members also enjoy access to private student clubs and forums, full access to our database that tracks upwards of 3,300 film school applications, Acceptance Data statistics that demystify common questions about how to construct a winning portfolio, ideal GPAs and GRE scores, and much more!
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Alexa P.
Alexa has 5+ years of experience developing content for purpose-driven brands. Alexa credits watching movies for inspiring her as a poet and an artist. You can follow her latest projects on alexapellegrini.contently.com. To work with Alexa, connect with her over LinkedIn or email.

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