Americans worried about the resumption of federal student loan payments in October can stop sweating after President Joe Biden’s administration extended the payment and interest freeze for another four months.

That means the roughly 42 million federal student loan borrowers will be off the hook by January 30, 2022. However, the Biden Ministry of Education warns that this is the “last extension” of a March 2020 hiatus in student debt.

If you have student loans and your finances have been holding up pretty well during the pandemic, take advantage of the final months of the moratorium to pay off as much of that debt as you can.

Here are some ways you can try to reduce your student loan debt before payments resume.

Pay when you don’t have to

While it may be tempting to “take a break” from your student loans by February, it’s a smart idea to keep making regular payments – and even paying more than your usual minimum – when you can afford it.

With federal student loan interest rates frozen at 0%, any payments you make now will be used in full towards the principal amount of your loan.

That means you can potentially pull off a decent chunk of your loan balance. When student loan debt was frozen last year, the typical balance was reportedly between $ 20,000 and $ 24,999 Federal Reserve data.

Resuming payments early is unlikely to be an option if you have other debts, such as if you ran out of credit cards during a period of unemployment last year. You may want to use this time to reduce these debts with the help of a. to tame low-interest debt consolidation loan.

Look for a new repayment plan

You could settle your student loan debt faster by changing your current payment schedule, especially if the pandemic has cut your income and still hasn’t come back.

The government offers income-oriented repayment plans which allow borrowers to make more affordable payments based on what they earn. After you’ve made regular payments under an income-based plan for 20 or 25 years, your remaining debt will be forgiven.

The story goes on

This could be your best chance at getting some of your student loans canceled. President Biden has campaigned for the elimination of $ 10,000 in student debt per borrower, and leading Democrats are urging him to go to $ 50,000 – but there are now questions as to whether Biden has the authority to cancel massive student debts.

An easy money-saving step with a federal student loan is to sign up for auto deposit because signing up for auto deposits entitles you to a 0.25% interest rate cut when payments are resumed.

Refinance personal loans

If your student loans are from a private lender rather than the federal government, the longer payment hiatus doesn’t apply to you. But you can attack your student debt for the next few months by refinancing your loan, as the interest rates on student loan refi from private lenders are at historically low levels.

Whether or not you qualify for a refinance will largely depend on your creditworthiness and current income. If you are unsure of your score, today you can easily do it Check your creditworthiness online for free.

Even if you lost your job due to the pandemic, you may be eligible for a refi if you can provide evidence of capital gains, income from a part-time job, or find a co-signer to support your application. To get the best rate on a student loan refinance, you need to shop around as well Compare quotes from multiple lenders.

Just keep in mind that refinancing is not an option when you have a federal student loan, and replacing a federal loan with a private loan will make you out of the question for further government loan relief.

This article is for information only and is not intended as advice. It is provided without any guarantee.