May 17, 2022

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Student loan repayment pause extended until 2022, Biden admin announces

The Department of Education extended a pause on student loan repayment, interest, and collections, allowing borrowers more time to plan amid renewed concerns about COVID-19 due to the delta variant. 

“The payment pause has been a lifeline that allowed millions of Americans to focus on their families, health, and finances instead of student loans during the national emergency,” Secretary of Education Miguel Cardona said in a statement. “As our nation’s economy continues to recover from a deep hole, this final extension will give students and borrowers the time they need to plan for restart and ensure a smooth pathway back to repayment.”

“It is the Department’s priority to support students and borrowers during this transition and ensure they have the resources they need to access affordable, high quality higher education,” Cardona added.

TWO STUDENT LOAN SERVICERS END FEDERAL CONTRACTS, DESERTING 10M BORROWERS – ARE YOU IMPACTED?

This extension continues the pause on student loan repayment, interest, and collections until January 31, 2022.

The DOE has also approved $1.5 billion in borrower defense claims, reinstated $1.3 billion in loan discharges for 41,000 borrowers who received a total and permanent disability discharge and protecting 190,000 borrowers from potential loan reinstatement, and helped 30,000 small business owners with student loans seeking help through the Paycheck Protection Program. 

Republicans have panned the move.

“This extension does a grave disservice to borrowers across the country, and our children will pay the ultimate price for this irresponsible delay,” said Rep. Virginia Foxx, R.-N.C. 

“Secretary Cardona is using the permanent pandemic narrative to wield power rather than enact responsible solutions to help borrowers get back on track,” Foxx added. “I regret that Secretary Cardona did not show real leadership by working with Congress to transition responsibly the portfolio back into repayment by Oct 1 of this year. It is nothing less than a dereliction of duty.”