As my co-worker wrote in Slack, Thank gawwwwd. The Biden administration announced on Friday that it will extend student debt relief until the end of January.
This action is a reprieve for the 42.9 million people—roughly one in seven US residents—who currently have federal student debt. Payments toward federal student loans and interest have been suspended since the passage of the CARES Act in March 2020—as have collection actions on defaulted loans and negative credit reporting related to student loan repayment. Pandemic-related student debt relief was set to expire next month, on September 30. Now, that deadline is pushed to January 31, 2022. (The Washington Post has a handy guide for what to do when the debt relief expires.)
In a statement, Secretary of Education Miguel Cardona called this the “final extension.” “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,” Cardona said. “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.”
Several prominent Democrats are demanding more. “The payment pause has saved the average borrower hundreds of dollars per month, allowing them to invest in their futures and support their families’ needs,” Sen. Elizabeth Warren (D-Mass.), Senate Majority Leader Chuck Schumer (D-N.Y.), and Rep. Ayanna Pressley (D-Mass.) said in a joint statement after the extension announcement. “While this temporary relief is welcome, it doesn’t go far enough. Our broken student loan system continues to exacerbate racial wealth gaps and hold back our entire economy. We continue to call on the administration to use its existing executive authority to cancel $50,000 of student debt.”