How does the government shutdown affect student loans?

WASHINGTON — As a federal government shutdown begins Oct. 1, millions of student loan borrowers may be wondering how the funding lapse could affect their payments and services.
The short answer: Keep paying your bills.
Federal student loan payments remain due during a government shutdown, and borrowers must continue making payments on time to avoid delinquency or default, according to the Department of Education’s contingency plans from previous shutdowns.
About 9.9 million students receive some form of federal aid, spread across some 5,400 colleges, according to the department. Within the Office of Federal Student Aid, the department plans to furlough 632 of the 747 employees during the shutdown, although it didn’t say which ones. For most student loan issues, borrowers work with loan servicers hired by the department rather than directly with FSA staff.
Student loan servicing is considered essential and continues during shutdowns. Loan servicers will continue processing payments, and interest will continue to accrue on outstanding balances.
However, borrowers may encounter significant disruptions in other areas.
What continues during a shutdown
Federal student loan servicing operations remain active because they are funded through mandatory spending and fee-based revenue rather than annual appropriations. This means:
Monthly payments are still due and must be paid on time
Loan servicers continue processing payments
Interest accrues normally on all loans
Missed payments will be reported to credit bureaus
Pell Grants and federal loans will continue to be disbursed
The department will also continue to process the Free Application for Federal Student Aid, or FAFSA, which is a key piece of how colleges and universities provide aid packages to incoming students. Certain employees involved with rulemaking around changes to student loans, part of the “One Big Beautiful Bill” passed by Republicans, also will be kept on to meet deadlines set by legislation.
Private student loans are completely unaffected by government shutdowns.
What may be disrupted
Several student aid services could face delays or suspensions as Department of Education staff are furloughed.
Under the shutdown, the department will stop its investigations into schools and universities over alleged civil rights violations.
Customer service call centers may have limited availability or be closed entirely, making it difficult for borrowers to get help with questions or account issues.
Applications for loan forgiveness programs, including Public Service Loan Forgiveness, may experience processing delays, and income-driven repayment plan applications and recertifications could be delayed.
What borrowers should do now
Borrowers can set up automatic payments to ensure bills are paid on time even if customer service is unavailable. Download or save copies of account statements and payment history.
Students planning to file FAFSA forms for the 2025-26 academic year should submit applications as soon as possible to avoid potential processing delays.
The last significant government shutdown lasted 35 days from December 2018 to January 2019. During that period, federal student loan payments continued, but many borrowers reported difficulty reaching customer service representatives.