WASHINGTON D.C. – Earlier this month, the Biden administration and U.S. Department of Education announced they were extending the current pause of federal student loans along with interest and collections. The extension will run through August 31, 2022.
With many borrowers still feeling the negative financial impact of the COVID pandemic, the extension intends to provide relief from the student loan repayment burden for at least six additional months. The pause will allow payees the time to reassess their budgets to ready for repayment to the federal government.
While federal student loan payments are not required during the pause, borrowers may still continue their payments if nothing more than to pay on the loan interest.
“The Department of Education is committed to ensuring that student loan borrowers have a smooth transition back to repayment,” said U.S. Secretary of Education Miguel Cardona. “This additional extension will allow borrowers to gain more financial security as the economy continues to improve and as the nation continues to recover from the COVID-19 pandemic. It remains a top priority for the Biden-Harris Administration to support students, families and borrowers—especially those disproportionately impacted by the pandemic. During the pause, we will continue our preparations to give borrowers a fresh start and to ensure that all borrowers have access to repayment plans that meet their financial situations and needs.”
On February 3, 2020, the Trump administration first declared a United States Health Emergency followed by the March 13, 2020 Federal Emergency declaration, at which point many federal student loans were placed on hold by the Department of Education as the country began the COVID lockdown. During this time, millions of U.S. workers deemed “non-essential” were unable to work.
Now that the American workforce is back with its nose to the grind, the administration and Department of Education will continue to monitor the viability of restarting student loan payments in September of this year.
For more information, please visit https://studentaid.gov/.
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