You Can Get a Refund for Student Loans Payments Made During the Pandemic. Here’s How

President Biden announced a plan this week to forgive up to $20,000 per borrower in federal student loan debt, a long-awaited measure that will eliminate the student debt burdens of about 20 million Americans.

The plan will forgive up to $10,000 in federal student debt for people who make less than $125,000 per year, and up to $20,000 for borrowers who attended college with Pell Grants, designed to help low-income students, and meet the same income requirements.

Biden also extended the pandemic-related pause on federal student loan payments “one final time” through Dec. 31, announcing that borrowers would be expected to resume payments in 2023.

But if borrowers have still been making payments during that pause, which began on March 13, 2020, they can request a refund for any payments on federal loans made during that time period.

“You can get a refund for any payment (including auto-debit payments) you make during the payment pause (beginning March 13, 2020),” according to an explainer on the U.S. Education Department’s Federal Student Aid site.

Who is eligible for student loan refunds?

Borrowers who have continued paying down their federal student loans since March 2020 are eligible to request a refund, though the vast majority of borrowers have not continued to make payments during this pause.

Just 1.2% of borrowers did, according to an analysis of Education Department data by Mark Kantrowitz, an expert on student loans.

How to request a refund

The Education Department said borrowers should contact their loan servicer to request a refund on payments made during this window.

Beyond those refunds, the department is planning to launch an application in the coming weeks that borrowers can use to apply for loan forgiveness under Biden’s new plan. Some eight million borrowers could receive debt relief automatically if they qualify for forgiveness and their income information is already on file with the Education Department.

Is it a good idea to get a refund?

Under the Biden Administration’s new debt forgiveness plan, eligible borrowers’ relief is capped at the amount of outstanding debt they owe. For example, if a borrower is eligible for $20,000 of relief, but has already paid down some of their student debt to $15,000, they will not receive more than $15,000 in debt relief.

But borrowers who request a refund on payments can bump their student debt balance back up to what it was in March 2020, and could therefore increase the amount of relief they can receive, provided it’s still within the $10,000 or $20,000 limits.

For borrowers already on track to receive the maximum amount of loan forgiveness — up to $10,000 for some and up to $20,000 for Pell Grant recipients — requesting a refund might not make sense because it won’t change the amount of relief they’re eligible for.