With student loans coming due again, many borrowers are losing a lifeline

With student loan payments on hold for three years, Ashley Dorn, a public school music teacher, has found another use for the money she saved during the hiatus. She used the extra money to pay down her $10,000 credit card debt, a bill that had been bothering her for a decade.

“I couldn’t have done it if it wasn’t for student loan debt that stopped, and I’m worried I’m going to have to start piling it all up again,” she said of credit card debt. She said she could not imagine being able to afford the payments unless she found another job, on top of her “already very time-consuming, already very stressful career”.

She makes about $50,000 a year and her husband makes about $45,000 as a government employee, but they’re still living paycheck to paycheck. Since graduating in 2014 with a master’s degree in education from SUNY Empire State College, Ms. Dorn and her husband, Jonathan, who lives near Albany, have been making monthly payments of more than $160,000 in student debt. They paused in March 2020, when, as part of pandemic relief efforts, the Trump administration said borrowers with federal student loans could stop making monthly payments.

The couple’s payments were roughly $900 a month, as Ms. Dorn was on an income-driven repayment plan, which adjusted payments according to the borrower’s salary.

Now that the pause ended in late August, and with President Biden’s proposal for debt forgiveness denied by the Supreme Court, Dorrence and millions of others are facing the reality of resuming loan payments.

For many 43.6 million For borrowers with federal student debt, the three-year moratorium created a financial cushion that allowed them to use the money for other purposes: buying homes, paying down credit card debt, supporting family members, undergoing delayed medical procedures and booking vacations. They are now figuring out how to cut back to fit these payments into their budgets.

The Dorns had long assumed that they would have children one day, but their student loan debt burden made them reconsider. For now, their two dogs, Mika and Oscar, and two cats, Ellie and William, have to be content with it.

“This conversation is, like, off the table indefinitely,” Ms. Dorn, 33, said. In addition to monthly expenses like mortgage payments and cars, Mr. Dorn suffers from Crohn’s disease, which adds an extra layer of financial stress.

The couple said they expect their new monthly payments, which will be calculated through income-based payment plans, to be around $800. That may change with the Department of Education’s new IDR option, which is Savings on a valuable education plan, or savingswhich factors income and family size.

Before the payments stopped, Ms. Dorn relied on her credit card for expenses like an unexpected emergency room visit, vet bills, healthcare co-payments, and new tires. She used the credit to replace the water heater, cover some auto insurance payments, and install a new transmission in her husband’s car. Within the past six months, she has paid off her credit balance and closed the card using a debt-resolution program.

For Chantelle Anderson, 27, the downtime was a lifeline that allowed her to support her mom and help her avoid eviction. The two struggled when Anderson was growing up in Philadelphia, moving from apartment to apartment until they were evicted. They end up in a homeless shelter for a week before college starts. Her mother had lost her job earlier that year, and Mrs. Anderson, then 18, had postponed her first fall semester of college because she could not afford tuition. Having lost most of her possessions during the eviction, Mrs. Anderson relied on donations from the people in her life, including a school guidance counselor, for housing supplies.

Ms. Anderson obtained financial aid and student loans to study political science at Eastern University while keeping a work-study job and other jobs, but still graduated in 2018 with $43,000 in debt. The endowment, which provided $455 per month, allowed her to cover her mother’s phone bill and some car repairs. Mrs. Anderson also helped her mother with groceries, medicine, gas, and cat food. With those costs addressed, her mother can set aside all of her income to pay rent and utilities.

Mrs. Anderson’s first full-time job was outside of school, at a veterinary hospital, paying $32,000 a year, and the hospital provided housing at the time. When the recession hit, her hours were cut. I made one last full payment on my student loan in March 2020, then made a few more monthly payments of $50. But when she found out she would lose her home, she stopped making debt payments to pay rent and other bills.

The pause allowed her to move into a three-bedroom high-rise apartment with a pool and gym — amenities she thought she’d never be able to afford — paying $500 for her share of the monthly rent with three roommates. She bought a car, which made it easier to run errands, and was able to cover about $400 in co-payments for health problems and unexpected medical procedures.

Some borrowers were shocked last August when Mr. Biden’s debt relief plan was announced.

“That day was crazy for me,” Anderson said. She believed the plan would cut her federal debt in half. Her relief quickly gave way to doubt after Republican lawmakers filed a series of lawsuits to block the plan.

When the payments resume, Ms. Anderson expects her monthly bill to remain around $455, which she will add to her $250 monthly car and credit card payments. She increased her income to more than $60,000 a year working as a data manager for a nonprofit, and signed up for Public Service Loan Forgiveness (PSLF) last October—but she’s already started cutting back on some expenses.

She stopped going to therapy to save on the out-of-pocket co-payments and talked to her mother about not being able to help her as much. Anderson said that in an emergency she would sell her car.

She still helps with some of her mom’s expenses: the phone bill, gas money to commute to her part-time job at a nursing home, and occasionally groceries. But her mother is already behind on rent, and her landlord has filed papers for eviction.

“She had a court date,” Anderson said. The homeowner did not show up, so the judge dismissed her case. I was like, Thank God, we have more time.”

For others, the pause has helped redirect money toward items like home renovations and vacations. Elizabeth Burton and her husband, Kyle Dion, hold private and federal student loans of about $175,000. The endowment saved the couple, who live in Manchester, New Hampshire, about $650 a month. Her schedule as a sonographer allowed her to stay home during the day, saving them an extra $1,200 in childcare costs during the pandemic, while keeping their 8- and 5-year-old at home.

While Mrs. Burton, 39, and her husband, 38, a salesperson, still had to shell out $500 a month for private loans, the extra money allowed them to put a second bathroom in their home, pay off credit card debt, and book an eight-day family vacation at Disney World.

Now that Mrs. Burton and her husband have higher-paying jobs, they think an income-driven repayment plan will result in a higher bill than before.

“There’s no money for my kids to go to college,” said Mrs. Burton. “I’m still paying off my loans. But you know my son is 8. I have 10 years left on my federal loans. There’s no money for him. He’ll either have to take out loans, he’ll have to live at home, he’ll have to get a scholarship—I have nothing left for him.”

The Dorns have used some of their student debt money saved up to book a vacation, too—in July 2025. They plan to celebrate their anniversary in Jamaica, hoping to soak up the tropical weather and explore the marine wildlife. The couple is on a payment plan for the trip, which offers the option to spread small payments over three years. Mrs. Dorn said it was their dream vacation. But with the payment pause over, they’re considering giving that up, too.