The White House announced on Friday that the moratorium for federal student loan payments is being extended until January 31, 2022. The Department of Education says that this will be the final extension.
“The payment pause has been a lifeline that allowed millions of Americans to focus on their families, health, and finances instead of student loans during the national emergency,” Miguel Cardona, Secretary of Education, said. “As our nation’s economy continues to recover from a deep hole, this final extension will give students and borrowers the time they need to plan for restart and ensure a smooth pathway back to repayment.”
The moratorium was part of the CARES Act that was passed in March 2020.
The Department of Education plans to notify borrowers about the extension and provide resources for payment plans.
The Federal Reserve estimates that Americans owe more than $1.7 trillion in student loans.
Lawmakers are calling for President Joe Biden to offer more to students and borrowers. Senate Majority Leader Chuck Schumer, Senator Elizabeth Warren, and Representative Ayanna Pressley want the President to cancel some student loans.
“While this temporary relief is welcome, it doesn’t go far enough,” the three lawmakers wrote in a joint statement.
“We continue to call on the administration to use its existing executive authority to cancel $50,000 of student debt. Student debt cancellation is one of the most significant actions that President Biden can take right now to build a more just economy and address racial inequity,” the group wrote.
In a statement, President Biden said the pause “will give the Department of Education and borrowers more time and more certainty as they prepare to restart student loan payments. It will also ensure a smoother transition that minimizes loan defaults and delinquencies that hurt families and undermine our economic recovery.”