Borrower balances have effectively been frozen for almost two years, and no payments are required on most federal student loans since March 2020. Meanwhile, interest has stopped accumulating and debt collections have stopped. suffering were suspended.

Some Democrats pressured Biden to extend relief

New York Senate Majority Leader Chuck Schumer, Senator Elizabeth Warren and Representative Ayanna Pressley, both of Massachusetts, pressured Biden to extend the student loan repayment hiatus and applauded the announcement of the extension.

“Extending the break will help millions of Americans make ends meet, especially as we overcome the Omicron variant,” Schumer, Warren and Pressley said in a statement.

But they continued to urge Biden to take further action and write off up to $ 50,000 in student loan debt per borrower.

Biden said during the presidential campaign that he would support the cancellation of $ 10,000 per borrower, but took no action to do so beyond asking federal agencies to conduct reviews to determine if he had. the power.

Asked earlier this month about this campaign pledge, Psaki said executive authority over the cancellation of student loans was still under review and added that the president supported congressional action on the issue. .

“If Congress sends him a bill, he’s happy to sign it. They haven’t sent him a bill on it yet,” she said.

Prepare to resume payments

“As we prepare for the return to repayment in May, we will continue to provide tools and supports to borrowers so they can complete a repayment plan that is appropriate for their financial situation, such as an income-based repayment plan. Education Secretary Miguel Cardona said in a statement Wednesday.

Most borrowers on federal student loans have not had to make any payments since March 2020. Direct loans as well as PLUS loans, which are available to graduate students and parents on behalf of their children, are eligible for the loan. ‘advantage. Certain federal loans that are guaranteed by the government but not technically owned by the government, known as Federal Family Education Loans, or FFELs, were not eligible. In general, these were disbursed before 2010.

The relief is even greater for those working in the public sector and may be eligible for the federal student loan exemption after 10 years. They still receive credit for those 10 years of required payments as if they had continued to make them during the pandemic, as long as they are still working full-time for eligible employers.

Borrowers will receive a billing statement or other notice at least 21 days before their payment is due, according to the Department of Education. Those who had set up automatic payments may need to let their loan management company know that they want them to continue.