Biden administration extends payment break for student loan borrowers until May 1
Amid concerns over the new omicron variant of the Covid-19 virus, the Biden administration will extend the payment break for federal student loan borrowers until May 1.
“We know that millions of student loan borrowers still face the impacts of the pandemic and need more time to resume payments,” President Joe Biden said in a statement on Wednesday.
As of March 2020, borrowers have the option of pressing the pause button on their monthly bills with no accrued interest on their debt. Almost all borrowers accepted the relief, according to research.
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The abstention was due to expire at the end of next month, on January 31.
Still, Democrats and supporters have pressured President Biden to give the 42 million Americans in debt more time. Another wave of the virus is also adding to concerns about the economy and the ability of borrowers to resume payments.
A recent survey of student loan borrowers found that even among those who are now fully employed, 89% are still not financially secure enough to restart payments.
Scott Heins, a freelance photographer in Brooklyn, New York, who owes more than $ 20,000, said he was relieved by the news. Much of its income dried up during the pandemic.
“Little by little things are improving,” said Heins, 33. “But the weight of an omicron on my work remains to be seen.”
The stock of student loans in the United States has exceeded $ 1.7 trillion and weighs more on Americans than credit card and car debt. About a third of borrowers are in default or in default. The average monthly bill is around $ 400 per month.
Senator Elizabeth Warren, D-Mass., And Senate Majority Leader Chuck Schumer of New York City applauded the president for giving borrowers more time, but said they expected let it do more in debt relief.
“We continue to call on President Biden to take executive action to write off $ 50,000 in student debt, which will help close the racial wealth gap for borrowers and accelerate our economic recovery,” they wrote, with Rep. Ayanna Pressley, D-Mass. , in a report.
Biden called on the US Department of Justice and the US Department of Education to review his legal authority to authorize loans without Congress. The results have not yet been made public, but the president has so far expressed hesitation in making such a move.
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