H.R. 5816 — HELP FEDs Act

This section defines terms for purposes of the Act as follows: (1) "Federal employee," meaning an employee as defined in 5 U.S.C. §2105 or §2107, or a judicial employee as defined in 5 U.S.C. §13101(9); (2) "qualified education loan," meaning any loan made, insured, or guaranteed under the Higher Education Act of 1965 (20 U.S.C. 1071 et seq.), including loans held by the Department of Education or contracted loan servicers; and (3) "involuntary disruption of pay," meaning a situation where a Federal employee does not receive scheduled wages due to a lapse in funding causing the Federal Government to cease operations under 31 U.S.C. §1341 (i.e., a government shutdown).

This section establishes protections for federal employees holding qualified education loans during periods of involuntary disruption of pay occurring on or after October 1, 2025 (applicable retroactively), by (1) prohibiting assessment of late fees, penalties, or other adverse actions for missed payments; (2) prohibiting additional interest accrual; and (3) prohibiting loan servicers from furnishing related adverse information to consumer reporting agencies. It directs the Secretary of Education to coordinate with credit reporting agencies and loan servicers to implement these measures and to remove any prior inappropriate adverse credit information.

This section directs the Secretary of Education, in coordination with the Director of the Office of Personnel Management, the Administrative Office of the United States Courts, the Clerk of the House of Representatives, and the Secretary of the Senate, to issue regulations and guidance necessary to implement the Act within 30 days of enactment. It further requires loan servicers and credit reporting agencies to fully cooperate with the Secretary in implementation.