Loan payment

Extend student loan payment break again

  • More than 100 Democrats have signed a letter to Biden urging him to extend the student loan payment break.
  • They referenced the ongoing pandemic and inflation as reasons for continued relief.
  • The payment break is currently set to expire on August 31, just over a month away.

More than 100 Democratic lawmakers have a message for President Joe Biden: Extend the student loan payment break.

Thursday, the senses. Chuck Schumer, Bob Menendez, Cory Booker and Elizabeth Warren, along with Representatives Ayanna Pressley, Lauren Underwood and Tony Cárdenas, led 100 of their fellow Democrats to send a letter to Biden and Education Secretary Miguel Cardona, pushing for an extension of the federal pause on student loan payments. The pause, which is currently set to expire after August 31, is just over a month away, and millions of borrowers are still awaiting news on whether it could be extended again, as well as Biden’s decision on a large student loan forgiveness.

“Resuming student loan payments would force millions of borrowers to choose between paying their federal student loans or putting a roof over their heads, food on the table, or paying for child care and health care. healthcare — as costs continue to rise and yet another COVID-19 variant increases hospitalizations nationwide,” the lawmakers, including Rep. Alexandria Ocasio-Cortez and Rep. Ilhan Omar, wrote. “Despite significant declines over the past month, gasoline prices are still high and many borrowers still have to pay exorbitant sums every week to get to work.”

Inflation levels in the United States are currently at their highest level in 41 years, and some members of the Biden administration are concerned that canceling student debt could exacerbate high prices. Jared Bernstein, a member of the White House Council of Economic Advisers, previously told the New York Times that restarting payments at the same time as canceling student debt could offset any inflationary impact.

But yet, speculations about another possible extension are circulating. In recent weeks, the Ministry of Education has asked student loan companies to suspend education of borrowers regarding the upcoming resumption of student loans, which is the same action the ministry took in March before extend the break. But while Education Secretary Miguel Cardona has said borrowers will be given “adequate notice” of any changes to the calendar, August 31 is fast approaching and uncertainty levels are high.

Biden is also deciding on a broad student loan forgiveness, apparently considering $10,000 in relief for borrowers earning less than $150,000 a year. But given the possibility of targeted relief, lawmakers and advocates say an extension of the pause is further warranted to ensure any relief can be fully implemented before borrowers are hit with another monthly bill.

Lawmakers referenced how resuming payments would “further complicate administrative actions already underway or contemplated by the Department” such as forgiveness, as well as temporary waivers for targeted loan forgiveness programs for government officials and low-income borrowers.

Although the White House has yet to comment on another possible extension, Republican lawmakers have consistently criticized the possibility. GOP Rep. Virginia Foxx recently said Biden “greatly overstepped” his authority by extending the payment pause four times, attributing them to a “stimulus payment” because they left money in the pockets of borrowers during the pandemic.

As for general relief, press secretary Karine Jean-Pierre said during a press briefing this week that Biden “understands what this means for families, how heavy it can be. I don’t I just have nothing left to share. And he said himself, by the end of August, so it’s just around the corner… He’ll make a decision.”