Biden May Extend Pause On Student Loans Beyond September 30

President Joe Biden (Photo by MIKHAIL METZEL / SPUTNIK / AFP via Getty Images)

SPUTNIK / AFP via Getty Images

If you have a student loan, there may be good news.

Here’s what you need to know.

Student Loans

On Wednesday, a new ray of hope surfaced on Capitol Hill that could delay your student loan payments beyond September 30, 2021. As Business Insider first reported, US Secretary of Education Miguel Cardona said during a testimony to the Senate Grants Committee that there would be “talks continuing” about a possible extension of the student loan disbursement period.

“We are holding discussions about whether [September 30, 2021 is] The best time [to end the pause on student loan payments]”Said Cardona. “No announcements today, but we’re continuing these talks.”

In response to the Covid-19 pandemic, Congress added extensive student loan relief to the Cares Act, the $ 2.2 trillion stimulus package. This student loan facilitation included:

• No federal student loan payments;
• No accrual of interest for federal student loans; and
• No collection of defaulted student loan debts.

President Donald Trump extended this student loan relief from October 1, 2020 to January 31, 2021. In January, President Joe Biden extended the student loan relief by eight months to September 30, 2021. Biden also extended this student loan relief to 1.1 million student borrowers with FFELP loans. Without an extension, payments for federal student loans will resume from October 1, 2021.

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An extension of the student loan break seemed unlikely

At an Education Writers Association conference last month, Cardona hinted that Biden could suspend federal student loan payments beyond September 30, 2021. However, he also said that no decision was made and suggested that student loan borrowers should expect student loan payments to be suspended on October 1, 2021 to resume. “We’re looking at this,” Cardona said in May. “Of course we will be guided by what the data tells us and where we stand as a country in terms of pandemic recovery. It is not out of the question, but at this point [the payment pause will end] September 30. ”Cardona’s comments last month are in line with his comments on Capitol Hill yesterday. However, Cardona informed the senators that talks are ongoing about whether to extend the student loan facility, which left the door open for a possible extension.

Student Loans: What To Expect

It is possible that the Department of Education may extend the student loan payment break beyond September 30, 2021. However, this cannot be the case. So be prepared to start paying the federal student loan on October 1, 2021. In both cases, the Department of Education will make a decision this summer so that student loan borrowers are notified of the student loan payments in a timely manner. You can also contact your student loan service provider. Many student loan borrowers are still facing financial problems due to the Covid-19 pandemic. Expect a written notice from the Department of Education notifying you whether student loan payments will resume on October 1st and what to expect in relation to your student loan payments. The Department of Education estimates student loan borrowers from March 2020 through 30. This student loan cancellation is in addition to the $ 3 billion in student loan Biden has canceled since taking office in January.

If the student loans are paused or resumed on October 1st, you will still need a student loan game plan. Here are some smart ways to save money:

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source https://collegeeducationnewsllc.com/biden-may-extend-pause-on-student-loans-beyond-september-30/