Student Loans: Will the Current Repayment Pause Be Extended?

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Student loan payments have been suspended since March 2020 as part of the federal pandemic relief law. There were no instructions as to when and if the payments would resume.

The clock is ticking … student loan payments are scheduled to resume in a month. Be prepared and see how things go.

FOLLOW UP

  • President Joe Biden plans to announce a student loan forgiveness program by the end of the month. That’s when the current suspension of payment up
  • One possibility: $10,000 to the relief of some borrowers.
  • Some advocates say it’s not coming far enough and concerned about insufficient information.

BACKGROUND

  • Student loan payments have been suspended since March 2020 as part of federal pandemic relief signed by former President Donald Trump and extended by Biden.

  • There were no instructions as to when and if the payments would resume.
  • Biden will reportedly give borrowers making less than $150,000 about $10,000 in aid. But his administration has been largely silent on the specifics.

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A 2022 study found that the majority of Gen Z and millennial borrowers have put off a major financial decision because of student loan debt.

WHAT IS HAPPENING

  • Experts say the pause is likely to be extended a seventh time.
  • why? These reasons relate to mid-term elections, rising inflation, and lack of communication with credit services.

  • However, debt cancellation has no effect on the rising cost of higher education.

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Millions of Americans saddled with student loans have more than $1.7 trillion in debt.

WHY IT’S IMPORTANT

  • Millions of Americans saddled with student loans have more than $1.7 trillion in debt. Most of it is federal.

  • A 2022 study found that most Gen Z and millennial borrowers put off a an important financial decision — for example, buying a house — thanks to a student loan.

  • 59% of graduates with debt said their higher education improved their job opportunities. 10% said they regretted it.
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Experts say the pause is likely to be extended a seventh time.

SOURCES

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Lawmakers turned to President Joe Biden.

MORE DETAILS ABOUT THIS IN SUM

The Sum breaks down complex economic issues and how they affect your life in just a few minutes a day. Follow thesum.news on Instagram for full coverage.

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The Sum breaks down complex economic issues and how they affect your life in just a few minutes a day. Follow @thesum.news on Instagram for complete coverage.



Student Loans: Will the Current Repayment Pause Be Extended?

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