Short answer: Keep making required payments and keep using StudentAid.gov. A shutdown can delay new loans, some school disbursements, and paperwork reviews. It does not wipe out balances, qualifying PSLF months, or FAFSA submissions already in the system.
What usually continues
Federal student loans already on a servicer’s books still exist. Billing, online accounts, and many automated payments have continued through prior lapses because servicing is obligated work. Interest still accrues according to the terms of the loan, not according to whether Congress has passed a discretionary bill.
Pell Grant and Direct Loan authority is more complicated: some aid can continue from prior balances or mandatory funding, while new origination and certain campus-based programs wait on the Department of Education plan.
What can slow down
| Task | Typical shutdown effect |
|---|---|
| Paying a loan already in repayment | Continues; keep paying |
| StudentAid.gov login and forms | Often available |
| New loan origination | May delay |
| School requests for funds | May delay |
| FAFSA verification and corrections | May slow |
| PSLF and IDR reviews | May back up |
| Phone support | Often reduced |
A school’s financial-aid office may know whether it can disburse before a federal help desk answers. Ask the school and keep award letters.
What happened in the 2025 shutdown
The October 1 – November 12, 2025 shutdown is the most recent example of how the Department of Education operates during a lapse:
- Staffing. About 87% of Education Department staff were furloughed. Federal Student Aid planned to furlough 632 of its 747 employees.
- What continued. Aid disbursement and FAFSA processing continued.
- What did not change. Loan payments stayed due.
- Layoff notices. On October 10, 466 Education employees received reduction-in-force notices. The law that ended the shutdown, P.L. 119-37, voided RIFs taken during the lapse (section 120).
The pattern supports the advice in this guide: payments stayed due and core aid processing continued even with most staff furloughed. Each lapse can differ, and a heavily reduced office can still create backlogs after funding returns. For the full timeline, see the 2025 government shutdown.
What students and borrowers should do
- Pay as billed unless you have a written alternative status.
- Download your loan history and FAFSA submission confirmation.
- If you are close to a disbursement or a graduation audit, contact the school aid office early.
- For PSLF, submit certifications when you can; keep employer proof.
- Ignore messages that offer to “freeze” federal loans for a fee.
Aid that is really a grant to an institution, rather than a student loan, is covered in federal loans and grants.