Biden administration announces extension of pause in student loan payments

On Tuesday, the US Department of Education announced an extension of the pause on student loan repayments, interest and collections, which was initiated by the Trump administration in March of 2020 in response to the COVID-19 pandemic.

The move was in response to court rulings backing suits by Republican-led state governments and right-wing, corporate-funded lobby groups opposing President Biden’s executive order discharging a relatively small portion, less than a quarter, of the $1.75 trillion in student debt owed by 43 million federal student loan borrowers.

Biden’s plan, announced in August in response to pressure from congressional Democrats fearing a Republican sweep in the November midterm elections, would cancel up to $10,000 in student debt for individuals earning less than $250,000 a year, and by $20,000 for recipients of Pell grants, which go to low-income students.

The Department of Education has sent letters to the 16 million student debtors whose applications for relief have already been approved, telling them that no debt can be discharged. The letter states that “unfortunately, a number of lawsuits have been filed challenging the program, which [have] blocked our ability to discharge your debt at present.” It pathetically adds, “Your application is complete and approved, and we will discharge your approved debt if and when we prevail in court.”

The letter is a slap in the face to millions of students and youth who fell for Biden’s election promise to cancel $10,000 to $20,000 in student debt.

President Joe Biden with Education Secretary Miguel Cardona [AP Photo/Susan Walsh]

The government’s announcement on the temporary debt repayment holiday stipulates a maximum six month extension past the previous cut-off of January 1, 2023. It states: “Payments will resume 60 days after the Department is permitted to implement the program or the litigation is resolved , which will give the Supreme Court an opportunity to resolve the case during its current Term. If the program has not been implemented and the litigation has not been resolved by June 30, 2023, payments will resume 60 days after that.”

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