Student loans are due from May 1 but there may be more student loan relief.
Here’s what you need to know.
The Biden administration has thrown a financial lifeline to student loan borrowers who expected to resume federal student loan payments in about 30 days. Biden has granted his third extension of student loan relief to student borrowers through May 1, 2022 as the Covid-19 pandemic continues, with cases rising due to the Omicron variant. (Student loans may be on hold, but here’s why Biden extended student loan relief.) Congressional progressives like Sen. Elizabeth Warren (D-MA) and Senate Majority Leader Chuck Schumer (D-NY) have warned Biden for months that student borrowers are not financially ready to resume loan repayments. student loans. With this latest student loan relief, student borrowers may ask themselves this fundamental question: will there be more student loan relief?
Will there be more student loan relief?
Before extending temporary student loan forbearance for the third time, the Biden administration assured student loan borrowers that student loan payments would start again on February 1, 2022. (What Biden’s Latest Student Loan Relief Means for your student loans). They said this was the last extension and there would be no further deferral of student loan repayments. The US Department of Education, including Secretary Miguel Cardona, said the same thing. That is until Biden surprises everyone and extends student loan forbearance for 90 days. (Why Biden extended student loan relief). When Biden last extended student loan relief in August, Biden’s announcement referred to the continued deferral of student loan repayments as the “final” extension. However, for this latest student loan relief, Biden’s announcement did not call this extension “final.” While this alone does not mean that student loan relief will be extended beyond May, this omission may provide the Biden administration with additional flexibility if Biden decides to offer a further extension of the payment break. student loans.
Student loan relief: Biden has several options
More student loan relief may be coming. If so, Biden would have several options for giving borrowers more student loan relief. For example, the Department of Education will forgive $2 billion in student loans in the coming weeks. Biden could also extend current student loan relief for the fourth time, enact targeted student loan forgiveness to add to the $12.7 billion in student loans he already canceled last year, or implement large-scale student loan cancellation through executive action to appease progressive congressmen. (Here’s how to qualify for automatic student loan forgiveness). That said, there is no guarantee that Biden will extend student loan relief or that he will or may use executive power to enact large-scale student loan forgiveness. (Biden extended student loan relief, but advocates really want student loans forgiven.) As such, Biden may determine that this latest extension of student loan relief is the last. (Biden will not cancel student loans until student loan relief ends).
Student loans: next steps
What are the next steps for your student loans? Currently, Biden has given no indication that student loan relief will be extended for the sixth time. Therefore, you should expect to resume federal student loan repayments starting May 1. Although it is possible that student loan relief will be extended, you should pretend that this is not happening. The bottom line: Student loan relief won’t last forever. Make sure you know your student loan repayment options. Here are some popular ways to pay off student loans faster: