Biden Administration Sends Signal That It May Be Extending Student Loan Pause

The Biden administration has told student loan servicers not to send out billing statements to borrowers ahead of the scheduled end date of the current payment pause, signaling that officials may be preparing to extend the student loan payment pause yet again. The current student loan payment pause ends on August 31, meaning that borrowers will have to start repaying student loans for the first time since March 2020 in September, or face default if the pause expires. Servicers typically send out billing notices about a month before the payment is starting. President Joe Biden had last extended the pause…

Officials Raise Concern Over Biden’s Plan to Limit Student Loan Cancellation

As the Biden administration crafts a plan to cancel some amount of student debt, administration officials are reportedly raising concerns that adding income caps to the plan could be incredibly logistically complicated, risking the efficacy of the entire plan. As Politico reports, officials in President Joe Biden’s Education Department are saying in private conversations that it would be extremely difficult for the agency to implement the administration’s tentative plan to limit student loan forgiveness by income. The agency simply doesn’t have income information for the vast majority of student loan borrowers, sources told Politico. If the Biden administration were to…

Warren Expresses Concern Over Transition to Restarting Student Loan Payments

Democratic lawmakers sent a letter to Education Secretary Miguel Cardona this week, asking him to detail the agency’s plan to reduce hardship and confusion as student loan payments are soon scheduled to restart. The lawmakers, led by Sen. Elizabeth Warren (D-Massachusett), expressed concern that borrowers may not be informed about the end of the payment pause, and that borrowers could be hit with fees and other financial distress as a result. Restarting payments will be a huge financial burden for many borrowers, especially as the economy roils in response to the pandemic and global conflict. Recent polling has found that…

Report: Borrowers Will Lose $85 Billion Yearly If Student Loan Payments Resume

If student loan payments are allowed to resume without mass debt cancellation, borrowers will lose out on billions of dollars monthly, according to a new report done on behalf of Senate Majority Leader Chuck Schumer (D-New York) and Sen. Elizabeth Warren (D-Massachusetts). The Roosevelt Institute analysis finds that while the payment pause has helped borrowers save money and even accrue interest, it will cost them over $7 billion a month if payments resume in February. This translates to $85 billion annually. Restarting payments will especially impact Black and Latinx people, who hold disproportionate amounts of student loans and who struggle…