About 40% of federal student loan borrowers missed their first monthly payment this fall as the freeze on student debt expired

As the pandemic-related pause on student loan payments ended this fall, nearly 9 million borrowers, representing around 40% of the 22 million borrowers with bills due in October, missed their first payment, according to the Department of Education.

This marks a significant increase compared to October 2019 when less than 26% of borrowers missed their payments before the pause.

The Biden administration has introduced an on-ramp period through September 2024, during which borrowers won't face penalties for missed payments, although interest will still accrue. Some borrowers may need extra time to adjust to their repayment obligations, while others faced challenges due to errors from loan servicers contracted by the Department of Education.

For instance, MOHELA failed to send bills on time to 2.5 million borrowers, leading to administrative forbearance, and approximately 305,000 people received bills with incorrect amounts.