Amid pressure from progressive democratic leaders, President Biden extended the pause on student loan repayments until May 1, 2022. The move comes only weeks before the moratorium is set to expire.
In March 2020, at the onset of the pandemic, the Department of Education paused federal student loan payments and set the interest rates to 0% during the pause.
However, last week, the White House confirmed that borrowers were scheduled to resume payments on Feb. 1, 2022.
Today’s extension by Biden is meant to help relieve ongoing financial strain, amplified by the new Omicron surge as the pandemic continues.
“Given these considerations, today my Administration is extending the pause on federal student loan repayments for an additional 90 days — through May 1, 2022 — as we manage the ongoing pandemic and further strengthen our economic recovery. Meanwhile, the Department of Education will continue working with borrowers to ensure they have the support they need to transition smoothly back into repayment and advance economic stability for their own households and for our nation,” Biden said in a statement.
In a letter to the White House, Sen. Chuck Schumer, Sen. Elizabeth Warren, and Rep. Ayanna Pressley expressed concerns this past week, warning that millions of families could be hurt financially if Biden does not extend the federal government’s pause on student loan payments.
The trio also called on the President to cancel $50,000 in outstanding federal debt per borrower via executive order in their bicameral resolution. Progressive Democrats have maintained that Biden could exercise executive authority under the Higher Education Act to order the Department of Education to “modify, compromise, waive or release” student loans.
According to the Department of Education, borrowers were notified that they would receive a billing statement at least 21 days before their payment is due.
If borrowers can no longer afford their monthly payments, they may be eligible for an income-driven repayment plan. Under those plans, based on income and family size, a monthly payment can be as low as $0 a month.
The Department of Education has more information online about the payment restart.