In the ever-changing world of student loans, it is critical to stay up to date with current events and student loan rates. Below are the trends in student loans this week that could affect your loans and your wallet.
2 current student loan trends for the week of 28 June 2021
1. Democratic lawmakers are calling for an extension of the term for canceling student loans.
Senator Elizabeth Warren, Senator Chuck Schumer, Rep. Ayanna Pressley, and Rep. Joe Courtney sent a letter to the Biden administration calling for an extension of the student loan interest rate and a suspension of payments, which is currently due to expires 30 September 2021… The letter was signed by dozens of Democratic deputies.
In the letter, lawmakers are asking for an extension of the abstinence period until March 31, 2022, or until the economy reaches pre-pandemic employment levels, whichever is longer. They argue that even as the economy starts to improve, the extension is necessary for the borrowers who have suffered the most over the past year: “Women and people of color have been disproportionately affected by the pandemic, which some experts have considered“ the most uneven ”. recession in modern US history “and they are recovering at a slower pace.”
The postponed payments in October will cause a significant and unnecessary drag on the economy, they write, as a possible wave of outstanding federal student loans will cause long-term credit damage and damage the financial health of borrowers. While the government provides repayment alternatives such as income-driven repayment plans, the letter criticizes the availability of these plans, arguing that the registration process is lengthy and complex and that service companies will be overwhelmed by the potential flow of borrowers who will have to register after repayment. the pause ends.
How does it affect student loans
The Biden administration is already assessing the end of administrative leniency. Education Minister Miguel Cardona announced in May that expansion would depend on the state of the economy at the time. “[An extension is] it is not excluded, but now it is September 30, ”he said at a conference of the Association of Writers and Educators.
If you are worried about restarting payments, your best bet is start planning now – and act as if there will be no renewal. You can start preparing to apply for income-driven repayment plan or standard patience… In some cases, you might also think about whether it makes sense refinance your loans with a private lender to get a lower monthly payment.
2. The US Department of Education is holding public hearings on student loan write-off programs.
Last week, the U.S. Department of Education held a public online hearing for three days, allowing stakeholders to comment on 14 topics related to student loan forgiveness. Commentators can also provide advice on how current student loan legislation can be improved.
The hearing was specifically aimed at discussing changes to student loan programs made by the Trump administration. Under this administration, many borrowers have found it more difficult to qualify for student loan forgiveness through programs such as borrower-to-maturity protection.
These hearings will help shape future rules and regulations for student loans to make it easier for borrowers to qualify for programs such as government service loan forgiveness. Written comments are accepted by the Ministry of Education until July 1.
How does it affect student loans
If consensus is reached after these hearings, the Department of Education may revise the normative wording of student loans. The Biden administration has expressed interest in making changes to Government Service Loan Forgiveness, discharge for complete and permanent disability and more; Any changes to these programs could help more borrowers qualify for student loan forgiveness.
Whether you are new to obtaining student loans or in the process of paying off, it is wise to always know student loan rates can change. As 2021 progresses, more opportunities may open up for cheaper loans or loan forgiveness; follow up Student Bank Loan News Center for the latest trends.