(NEXSTAR) — While a looming government shutdown has been getting a lot of attention recently, there is another impending due date coming on October 1: the return of student loan payments.
Lawmakers are still working to prevent a government shutdown, which could come by the end of next week, but House Speaker Kevin McCarthy was dealt a heavy blow on Thursday.
His latest attempt to move ahead with a traditionally popular defense funding bill was shattered by a core group of Republican colleagues who refused to vote for the endangered speaker’s plans.
A test vote to advance the bill failed, 212-216, as a handful of Republicans joined with Democrats to stop it. Once again, the House then came to a sudden standstill and declared itself in recess. Lawmakers will return to work on Tuesday.
The federal government has until September 30 to reach a deal to avoid an October 1 shutdown.
October 1 also marks the day student loan borrowers will be on the hook for monthly payments for the first time since March 2020. While we’ve known this has been coming for months, some loan servicers have reportedly struggled to keep up with the influx of borrowers seeking assistance. A government shutdown could only enhance those struggles.
The Education Department, like every federal agency, has a contingency plan in the event that a government shutdown occurs, but it hasn’t been updated since 2021 when interest wasn’t accruing and payments weren’t required for student loans.
It does, however, state that servicing federal student loans, as well as disbursing Pell Grants and Federal Direct Student loans, “could continue for a very limited time,” but “these operations could also experience some level of disruption” during a shutdown.
Ahead of a potential government shutdown in 2018, the Department of Education issued an advisory that there would be “minimal impacts” on borrowers and lenders, among other groups.
The Department of Education directed questions to the U.S. Office of Management and Budget.
As it stands, you can expect to start paying for your federal student loans in October.
The Associated Press contributed to this report.