After Congress failed to pass a funding gap measure, the federal government officially shut down today. While essential employees will work through the shutdown, we may see impacts to federal programs nationwide. According to a memo from the Secretary of Education, Linda McMahon, to the Office of Management and Budget, it was indicated that 1,485 out of the 1,700 employees at the U.S. Department of Education’s Office of Federal Student Aid (FSA) have been placed on furlough.
Along with an already smaller team due to the reduction in force several months ago, this team will be tasked with maintaining critical operations. However, this does mean there may be some impacts to student loan borrowers and students applying for financial aid.
What to Expect as a Student Loan Borrower
For student loan borrowers in repayment, there may be some delays in processing. While most borrowers who are actively paying and not seeking any changes or forgiveness, the impacts will be minimal. Students can still contact their federal student loan servicer with any questions, and submit payments as required.
For borrowers who have submitted applications to enter or change their income-driven repayment plan, or those seeking Public Service Loan Forgiveness (PSLF), there could be additional delays. Prior to the shutdown, it was already known that FSA had a significant backlog in application processing. With staff now placed in furlough, it’s unclear how or if these applications will be processed during the shutdown. If they are not processed, or processing slows, the backlog may grow and may leave borrowers waiting more than six-months for processing.
The shutdown down does not prevent the submission of applications. Borrowers should continue to take their intended actions and understand that processing may take several months before decisions are made.
Is the FAFSA® Impacted by the Shutdown?
Fortunately, since the FAFSA® was launched before October 1, it seems like there should be limited impact to those who need to complete the application for financial aid during the shutdown. In addition, the FAFSA® was beta tested for several months before the late September launch.
At this time, there is no indication that there are issues with the FAFSA. Many of the processes are automated after submission. However, if there is a system issue or website error, there may be some delays in fixing the site.
Information from Federal Student Aid
The FSA website, StudentAid.gov, has indicated that there may be a lapse in site maintenance and updates during the shutdown. As we have been waiting for updated information regarding changes from the One Big Beautiful Bill, or decisions from court cases that have tied up SAVE Plan and ICR Plan borrowers, don’t expect those updates to be made during the shutdown.
However, it seems like you can still submit the FAFSA®, repayment plan applications, complaints, and use tools on the site.
What to Do During the Shutdown?
If you’re feeling anxious because the federal government shutdown, you’re not alone. There are several services and resources the average American seeks from federal programs. As prospective college students, college students, and student loan borrowers, you may be relying on federal resources for information, financial aid, and student loan repayment.
It’s best to continue taking steps to achieve your necessary goals in higher education or student loan repayment. With the shutdown in mind, just remember that you may run into a few hiccups or challenges. But once the government re-opens, operations should resume. You may need to be patient if you are stuck in a backlog but always remain proactive and check the status of your applications and accounts.
