Close to $200 billion dollars have been saved by student loan borrowers under a repayment freeze that started during the pandemic, a new analysis found, but researchers believe those borrowers will struggle to make repayments once the freeze is lifted, The Hill reported. An analysis by researchers from the Federal Reserve Bank of New York released on Tuesday found that an estimated $195 billion had been saved by close to 37 million student borrowers since a student repayment freeze began in March 2020. The researchers noted that this freeze was only applicable to those who had direct federal student loans and not those with private loans or Family Federal Education Loan (FFEL) loans that were owned by commercial banks. The researchers said that the difficulties those with FFEL loans had making payments during the pandemic “suggest that Direct borrowers will face rising delinquencies once forbearance ends and payments resume.” The analysis noted that between students who had direct federal student loans, private loans and FFEL loans, those with direct federal student loans had higher debt balances and lower credit scores as of February 2020.
