Loan payment

Democrats urge Biden to extend 6-month student loan payment break

  • 64 Democrats sent a letter to Biden urging him to extend the student loan payment break by 6 months.
  • Led by Elizabeth Warren and Chuck Schumer, they say borrowers are still recovering from the pandemic.
  • Education Sec. Miguel Cardona hinted at an extension of the break but did not say so definitively.

Borrowers with student loans have not had to repay them during the pandemic, but this pause on payments is expected to end at the end of September. Although Education Secretary Miguel Cardona has hinted at a further extension of the break, no details have yet been released.

Sixty-four Democrats want to give borrowers certainty – and another six months, at least, without paying off student loans.

Senate Majority Leader Chuck Schumer, Massachusetts Senator Elizabeth Warren, Massachusetts Representative Ayanna Pressley and Connecticut Representative Joe Courtney led 60 other fellow Democrats in sending a letter to President Joe Biden on Wednesday, urging him to extend the student loan payment hiatus until March 31, 2022, or until the economy returns to pre-pandemic employment levels, whichever is longer both.

Democrats wrote in the letter, obtained by Insider, that the hiatus on student loan payments and interest has provided “essential relief” to borrowers during the pandemic.

“Borrowers have reaped significant benefits from the ongoing payment hiatus, taking the opportunity to repay other debts, relieve financial pressures from lost jobs or declining income, and respond to financial pressures. needs of their families, ”the letter said.

But lawmakers added that “the expected resumption of student loan payments in October could create a significant drag on our economic recovery.”

The letter noted that while the economy was recovering from the pandemic, it was not affecting women and people of color in the same way. He cited research from Brandeis University which found that the median black borrower owes 95% of their debt twenty years after starting college, compared to just 6% for the median white borrower.

Insider reported last week that women can expect to earn a salary of $ 35,000 right after graduation – not much more than the average female student debt, according to the American Association of University Women.

Warren was one of the Democrats who sent a letter to CEOs of all student loan departments on Monday, asking them for information on how they best prepare borrowers to restart loan repayments, warning of the consequences “catastrophic” of borrowers returning to repayment without appropriate assistance.

Cardona said in a Senate hearing last week that he continues to have conversations about extending the payment break after September, but the Education Department declined to provide further details on those conversations. .

This letter is the latest in Democrats’ efforts to protect borrowers. Warren and Schumer are leading the effort to ask Biden to write off $ 50,000 in student debt per borrower using his executive powers – the ones the Education and Justice Departments are reviewing.

Democrats also acknowledged these reviews in their letter to Biden and called for their early completion, but given the rapid expiration of the payment break, they want Biden to act to extend that period in the first place.

“President Biden can and should write off student debt with the stroke of a pen. We urge him to act,” Pressley said in a statement. “In the meantime, extending this payment break will provide crucial additional relief to millions of borrowers. We cannot turn our backs on these families as we work for a fair economic recovery.”

Leave a Reply

Your email address will not be published.