Here’s who wants President Joe Biden to extend student loan relief.
Here’s what you need to know — and what it means for your student loans.
While student loan relief from the Covid-19 pandemic is expected to expire on January 31, 2022, a growing list of individuals and organizations are pressuring Biden to extend the student loan payment pause. Some want temporary student loan forbearance to be extended until March 31, 2022 or September 30, 2022. Others want student loan relief extended until the end of the Covid-19 pandemic. That said, student loan payments for federal student loans are expected to restart February 1, 2022. (Prepare for the end of student loan relief). Here’s a list of everyone who wants Biden to extend student loan relief.
Postpone student loan payments: 200 advocacy groups
In a letter to Biden, the Student Borrower Protection Center, a student loan advocacy non-profit, joined 200 organizations (including the ACLU, NAACP and American Federation of Teachers) to urge Biden to postpone the restart of federal student loan payments. (This comes amid news that the Education Department will cancel $2 billion of student loans within weeks). They argue that restarting student loan payments on February 1, 2022 is not only a financial issue, but also a health emergency with the ongoing Covid-19 pandemic and emergence of the Omicron variant. According to the letter: “In fewer than 60 days, tens of millions of student loan borrowers are slated to be thrown back into repayment on federal student loans they are ill-equipped to pay as the deadly Covid-19 pandemic continues to devastate Americans’ health and financial security. It is clear that payments should not resume until your administration has fully delivered on the promises you made to student loan borrowers to fix the broken student loan system and cancel federal student debt.” (Here’s who qualifies for student loan forgiveness right now).
Extend student loan relief: U.S. senators
A group of U.S. senators — including Senate Majority Leader Chuck Schumer (D-NY) and Sen. Elizabeth Warren (D-MA) — say that Biden must extend student loan relief to avoid financial disaster for more than 40 million student loan borrowers. (Here are the 5 worst things to do for your student loans). The senators say that restarting student loan payments will cause significant financial stress in the wake of the ongoing Covid-19 pandemic. Specifically, they cite a Roosevelt Institute study that shows that failure to postpone student loan payments beyond January 31, 2022 will cost student loan borrowers $85 billion. They argue that 9 million student loan borrowers in default could be subject to wage garnishment and other debt collection methods if student loan payments resume. In addition to seriously damaging the economy, the senators note that Black and Latinx households would face a disproportionate burden from resuming student loan payments. (Here’s how to get student loan forgiveness during the Biden administration).
Student loan borrowers say don’t restart student loan payments
There’s at least some contingent of student loan borrowers who aren’t prepared to restart student loan payments. Since March 2020, most student loan borrowers have enjoyed continuous student loan relief. (How to qualify for automatic student loan forgiveness). This temporary student loan forbearance includes no mandatory federal student loan payments, 0% interest rates on federal student loans, and no collection of student loan default in debt. As of January 31, 2022, student loan borrowers will have received $110 billion of student loan cancellation from 22 months of temporary student loan forbearance. (5 ways Biden could cancel more student loans). A recent survey from Student Debt Crisis Center, a non-profit focused on student loan debt, found some alarming statistics about student loans and student loan repayment. According to the survey, 89% of fully-employed student loan borrower say they aren’t “financially secure” enough to restart federal student loan payments on February 1, while 21% say they will never be financially secure enough to make any student loan payments again. (How to get student loan forgiveness)
Will student loan relief get extended?
Will student loan relief get extended? After Congress passed the Cares Act in March 2020, which granted student loan relief due to the Covid-19 pandemic, President Donald Trump extended temporary student loan forbearance twice for an additional four months. Biden also extended student loan forbearance twice through January 31, 2022 for another year. However, the Biden administration has said there will be no more extensions of this student loan relief. (No, Biden won’t extend student loan relief again). Federal student loan payments will restart beginning February 1, 2022. Despite pressure from progressives in Congress, student loan borrowers and advocacy groups, Biden is not expected to postpone the student loan payment pause. Some have conjectured whether Biden will enact wide-scale student loan cancellation before the end of temporary student loan forbearance. Schumer and Warren, for example, are calling for up to $50,000 of student loan forgiveness within the next two months. However, don’t expect Biden to cancel student loans before student loan relief ends.
To conquer your student loans, make sure you understand all your student loan options. Here are some popular ways to pay off student loans and save money: