Biden Admin Extends Student Loan Repayment Pause Until May 1, 2022

What’s the story?

• The Biden administration announced Wednesday that it is extending the pause on federally-held student loan payments for an additional 90 days through May 1, 2022.
• This extension is a reversal of the Biden administration’s previous assertion that the previous extension of the repayment pause through January 31, 2022, would be the last extension of the pause.
• The pause initially began in the spring of 2020 pursuant to the bipartisan CARES Act. Then it was extended on two occasions by the Trump administration before President Joe Biden extended it through September 2021 shortly after taking office, then he extended it in August through January 2022.
• While pause is in effect, the federally-held student loans do not accrue interest, payments aren’t required (although borrowers may continue to make payments against their principal balance), and collections of defaulted student loans are also paused. Borrowers with federally-held student loans do not need to request the pause from their servicer, as it takes effect automatically, although they can contact their loan servicer with questions.
• Biden explained his latest extension of the student loan repayment pause in a statement which read in part:

“Now, while our jobs recovery is one of the strongest ever — with nearly 6 million jobs added this year, the fewest Americans filing for unemployment in more than 50 years, and overall unemployment at 4.2 percent — we know that millions of student loan borrowers are still coping with the impacts of the pandemic and need some more time before resuming payments.”

• Rep. Jim Banks (R-IN), chairman of the conservative Republican Study Committee which has 158 members in the House GOP, questioned Biden’s reasoning for the latest extension in a tweet:

“So has the Biden administration built the greatest economy in 50 years or are we still in an economic turmoil that requires a pause on student loans? Can’t have it both ways, Joe.”

• Rep. Pramila Jayapal (D-WA), chair of the Congressional Progressive Caucus which has 95 members among House Democrats, released a statement that praised Biden’s “excellent and necessary decision” to extend the pause and added he should go even further by canceling student loan debt:

“But the work cannot stop here. The administration must now deliver on the President’s promise to cancel student debt, lowering costs for families at a critical time of tremendous health and economic uncertainty.”

• Sen. Tom Cotton (R-AR) tweeted that Democrats’ repeated extensions of the student loan repayment pause are unfair to Americans who repaid their loans or didn’t take out federal student loans to pay for college but will ultimately pay the bill: 

“There’s no free lunch. Not requiring student loan repayment means the majority of Americans who paid their debt or never took loans will get stuck with a trillion-dollar tab.”

— Eric Revell

(Photo Credit: iStock.com / Kameleon007)