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Biden Has a Problem: The Freeze on Student Loan Payments is Almost Over

More than 125 organizations sent a letter to Biden to uphold his promise of mitigating the student loan crisis and extend the payment pause.

by Rachel Bucchino L
Aslew of congressional Democrats, student loan advocacy groups and Education Department officials are pushing President Joe Biden to extend the federal student loan relief program beyond Sept. 30, arguing that borrowers are still stuck in financial turmoil due to the economic impacts of the pandemic.
Borrowers first saw the relief program when Congress passed the Cares Act in March 2020, a bill that froze all federal student loan payments and set interest rates at zero percent. Former President Donald Trump pushed the relief deadline twice, followed by Biden who extended the pause until the end of September 2021.

But some student loan advocates are calling to lengthen the pause until March 31, 2022, while others have urged Biden to extend it until the end of the coronavirus pandemic.

“We’re calling on the administration to extend the pause on student loan payments to help support Arizona families as we continue our coronavirus recovery,” Sen. Kyrsten Sinema (D-Ariz.), who joined more than 60 Democrats in writing a letter to the president in June, tweeted last week. “Extending the current pause on federal student loan payments will provide relief to Arizonans and help them continue to recover from the coronavirus recession.”
It’s unclear, however, whether the White House backs the extension effort. Several opponents argue that if the Biden administration agrees to elongate the paused payment period, then the move would collide with the president’s messages over working toward economic recovery. Student loan borrowers have experienced the pause for nearly 18 months, so an even longer extension would indicate that the economy “is so bad that student loan borrowers need even more time to pay student loans,” according to Zack Friedman, a contributor at Forbes.

And the pressure comes as the federal government is slated to end two separate financial relief efforts relating to the pandemic, including the enhanced unemployment insurance, along with the federal eviction moratorium implemented by the Centers for Disease Control and Prevention ending on July 31. Both are not expected to be renewed.

But the president could eradicate the expanded jobless benefits and the eviction moratorium while extending the student loan repayment deadline, though that surfaces the question of “Why should student loan borrowers get relief when other essential relief is ending,” Friedman argued.

Friedman also noted that there’s reportedly no “distinction” between student loan borrowers who can afford to make their payments after September 30 and those who cannot.

Education Secretary Miguel Cardona has not explicitly supported or deflected the effort, though he did note at a Senate hearing last month that, “Extending the pause is something that we have had conversations about.”

Rachel Bucchino is a reporter at the National Interest. Her work has appeared in The Washington Post, U.S. News & World Report, and The Hill.

More than 125 organizations, including the American Civil Liberties Union (ACLU), also sent a letter to Biden to uphold his promise of mitigating the student loan crisis and extend the payment pause.

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