Student loan payments to restart this year, Biden official confirms
Student loan payments put on hold during the COVID pandemic will restart this year, a Biden administration official told the Senate this week.
Education Secretary Muguel Cardona said the current student loan payment pause is in place for 60 days after June 30 or 60 days after the Supreme Court issues its decision on the White House’s wide-ranging student loan forgiveness program. That decision is expected to come by the end of June.
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The restart has been delayed eight time, but Cardona said it will not be pushed back a ninth.
“We recognize that during the pandemic that was very difficult for borrowers. And we are committed to making sure that once the decision is made, that we’re going to resume payments for 60 days after, but no later than June 30,” Cardona said, referring to the Supreme Court decision. “We’re going to begin that process.”
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“We recognize that our borrowers need information and they need a long on-ramp because it has been three years of resuming payments. We’re confident…that the Supreme Court will rule in favor of the targeted debt relief, providing relief for millions of borrowers, and we want to make sure that the information that borrowers get is accurate,” Cardona said. “We do plan on making sure it’s a smooth reentry to repayment.”
“The emergency period is over and we’re preparing our borrowers to restart,” he added.
Cardona’s comments were reported by Insider.
According to Insider, the education department has already started communications with student loan companies to help prepare borrowers to resume payment. The department said companies should prepare to resume charging interest on borrowers’ loans in September with the first monthly payments due in October.
The Biden plan currently before the Supreme Court would cancel up to $10,000 in student loan debt for those making less than $125,000 or households earning less than $250,000. People who received Pell Grants in college are eligible for up to $20,000 in loan forgiveness.