The Biden administration’s pause on federal student loan repayments was a welcome relief for many borrowers struggling to make ends meet in the wake
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This news has been met with some trepidation by borrowers, as the pause had given them some much-needed financial breathing room. However, the Education Department has said that it expects borrowers to start making repayments in October and has asked loan servicing companies to be ready to resume interest charging from September.
The debt ceiling deal also prohibits the Secretary of Education from using any authority to extend the pause unless “expressly authorized” by Congress. This means that borrowers will have to start making their student loan payments as soon as the pause ends.
The debt limit deal also leaves the fate of the White House’s marquee student loan waiver program to the Supreme Court. The program, which was announced in April, would offer a waiver of between $10,000 to $20,000 for nearly all people with federal student loans. The Supreme Court is expected to make a ruling on the matter in June.
Despite the end of the pause, Education Secretary Miguel Cardona praised Biden for averting a crisis with the deal and “protecting our student debt relief plan in full.” He added: “Despite Republicans’ efforts to end targeted student debt relief and move up our planned end to the payment pause, we will ensure a smooth return to repayment process. The deal also protects our ability to pause student loan payments should that be necessary in future emergencies.”
The end of the federal student loan repayment pause marks the end of a period of financial relief for many borrowers. However, the debt limit deal will ensure that borrowers do not have to worry about their student loan payments for the foreseeable future. It is important for borrowers to keep an eye on the Supreme Court’s ruling on the student loan waiver program, as it could provide much-needed financial relief for those struggling with student debt.
Title: Student Loan Repayment Pause to End in August as Part of Debt Ceiling Deal
