/  04.05.2022

The Biden administration is planning to extend a pause on federal student loan repayments through Aug. 31. The repayment freeze has been in place since the beginning of the pandemic for over two years now, and was previously scheduled to expire on May 1.

Although the official announcement hasn’t been maid yet, an official did confirm the administration is expected to announce the extension on tomorrow (Apr. 5), according to CNN. The forthcoming extension would be the sixth extension overall. It means the following for student loan borrowers:

  • no mandatory federal student loan payments;
  • 0% interest rates on federal student loans with no interest accrual; and
  • no collection of student loans in default.

Direct Loans as well as PLUS loans, which are available to graduate school students and parents on behalf of their children, are eligible for the benefit. Some federal loans that are guaranteed by the government but not technically held by it, known as Federal Family Education Loans, or FFEL, did not qualify.

For months, progressive Democrats in Congress and student loan relief advocates have been putting the pressure on the president’s administration to extend the student loan payment pause. For example, Sen. Elizabeth Warren (D-MA), has continuously argued that if Biden didn’t grant more student loan relief, millions of student loan borrowers would face student loan default and other financial set-backs.

Back in March of last year, the U.S. Department of Education announced that it was canceling $1 billion of student loans for 72,000 students who previously had some of their loans canceled. As previously reported by REVOLT, the Biden administration says the Trump administration used an unfair formula to cancel student loans by only creating partial forgiveness. Miguel Cardona, the U.S. Secretary of Education, replaced the past formula for student loan cancellation in cases of fraud with a new measure that will give “a streamlined path” so borrowers can get full student loan cancellation.

 

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