Biden administration extends student debt repayment holiday
President Joe Biden delivers remarks on protecting Social Security and Medicare and reducing prescription drug costs in Hallandale Beach, Florida on November 1, 2022.
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The Biden administration announced on Tuesday that it would extend the suspension of payments on federal student loans until after June or until it is able to move forward with its plan to cancel the debt.
Federal student loan bills were expected to resume in January.
The administration’s decision comes in response to a Federal Court of Appeals ruling last week that imposed a nationwide injunction on the debt relief plan.
“We are extending the payment pause because it would be deeply unfair to ask borrowers to pay debt that they would not have to pay, but for the baseless lawsuits brought by Republican officials and special interests,” the secretary said. to Education, Miguel Cardona. said in a statement.
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The pause will be extended for up to 60 days after the Biden administration is allowed to implement its student loan forgiveness plan and the litigation is resolved, according to a press release from the US Department of Education. If he cannot pursue his policy and legal challenges are still pending by June 30, 2023, student loan repayments will resume 60 days later.
It is the eighth time that the Ministry of Education has extended the relief policy in the era of the pandemic.
Federal student loan payments have been on hold since March 2020, when the coronavirus pandemic first hit the United States and crippled the economy. Taking over the bills of more than 40 million Americans will be a daunting task, and the Biden administration had hoped to ease the transition by writing off much of the student debt first.
Yet shortly after President Joe Biden announced his sweeping plan to cancel up to $20,000 in student debt for millions of Americans, a number of conservative groups and Republican-backed states took action. challenged the policy in court. Two of those lawsuits succeeded in at least temporarily halting aid, and the Department of Education shut down its loan cancellation portal this month.
A senior Department for Education official recently said student loan default rates could rise significantly if his loan forgiveness plan is thwarted, “due to continued confusion over what they owe.
Biden tweeted about the extension.
“I’m confident our student debt relief plan is legal. But it’s on hold because Republican officials want to block it,” Biden tweeted.
“That is why @SecCardona extends the suspension of payments until June 30, 2023 at the latest, giving the Supreme Court time to hear the case in its current term.”
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