Washington – New Bill Would Pause Student Loan Penalties for Federal Workers During Shutdowns

Washington, D.C. — A new House proposal would protect federal employees from student loan penalties, fees, and credit damage when government funding lapses interrupt their pay. The measure, introduced by Rep. Jasmine Crockett, applies to any future shutdown as well as disruptions occurring on or after October 1, 2025.

Under the HELP FEDs Act, federal workers who miss scheduled student loan payments during a shutdown would not accrue late fees, penalties, or additional interest. According to the bill text introduced October 24 and referred to the House Committee on Education and the Workforce, the Department of Education would also be required to coordinate with loan servicers and credit bureaus to ensure no negative credit data is reported during these periods.

The protections cover employees across the executive branch, military departments, and the federal judiciary. Families relying on federal paychecks could see fewer long-term financial impacts during extended shutdowns—particularly households balancing student loan obligations and childcare costs.

Parents affected by a shutdown could contact their loan servicer to confirm that payments are paused automatically. Financial counselors often recommend setting alerts to verify accounts remain in good standing once operations resume.

Next steps for the bill include committee consideration before it can advance to the full House. Updates will be posted on Congress.gov and through official agency channels.

This article was produced by a journalist with the assistance of Ai. This is not legal advice. All content is reviewed for accuracy and fairness.