Extend the student loan freeze or make it “permanent”

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Senator Elizabeth Warren, Massachusetts, proposed Tuesday that the Biden administration extend the current pause with regard to federal officials. student loan payments and interest, or introduce a permanent freeze.

Warren’s Twitter comments came in response to a statement earlier this week by Education Minister Miguel Cardona that the administration does not exclude extending the moratorium on student loans beyond the current September. The CARES Act passed by Congress last year temporarily suspended all payments, froze all interest, and suspended collection of all state federal tolls. student loans… After several renewals by President Trump and then by President Biden, the exemption is due to end on September 30, 2021. This means that millions of student loan borrowers will have to resume payments in October. Cardona said the administration “looking at“Possibility of further extension, which is” not excluded. “

“Freezing student loan payments has helped families live each month and has helped keep our economy afloat,” Senator Warren said on Twitter. The US Department of Education “could extend the moratorium again, or better yet, make this relief permanent: #CancelStudentDebt… “

Warren and her allies in Congress, as well as advocacy groups for student loan borrowers, demanded that Biden take executive action to enact widespread forgiveness and abolish student loans. During his presidential campaign, Biden promised “Eliminate” student loan debt of at least $ 10,000 for borrowers with income below a certain income threshold. “I’m going to make sure everyone gets $ 10,000 out of their student debt” in response to the economic hardships caused by the pandemic, he said. Lawyers urged Biden to cancel student loan debt of $ 50,000 or more for each borrower.

Others have called for reform or even the abolition of interest on student loans, echoing Warren’s call to make certain elements of the student loan freeze permanent. Eliminating interest on student loans will allow “every dollar returned” to be credited against the principal, some advocates argue… Last year, Senator Marco Rubio (R-FL) proposed replacing the student loan interest with a one-time, flat loan disbursement fee that would be paid over the life of the student loan.

Meanwhile, Biden hasn’t taken any steps to write off student debt – at least not yet. The administration has repeatedly indicated that Biden will sign the Student Debt Cancellation Act passed by Congress, but Congressional attention is focused on other issues, such as Biden’s proposals on infrastructure. And Biden has not expressed strong support for a broad decision to forgive student loans using the executive branch, although he has not ruled out that either. The administration is considering its options, and Biden has instructed US Department of Education and Justice Department officials to conduct a legal review of student loan forgiveness options.

Further reading

Highlights of Elizabeth Warren’s Blockbuster Hearing on Student Loans

Why Forgiving $ 10,000 Student Loan Can’t Help Borrowers Pay Income Based Payments

Biden student loan forgiveness review: should you take steps now to cancel your student debt later?

72,000 borrowers will receive $ 1 billion in student loan forgiveness – are you eligible?



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