Here’s what President Joe Biden’s student loan relief means for your student loans.
Here is what you need to know.
On Wednesday, Biden surprised everyone by deciding to extend the student loan payment break for another 90 days. Let’s describe what this means for you:
1. Student loan relief will continue until May 1, 2022
The good news is that student loan relief will continue for an additional 90 days beyond January 31, 2022, when it was scheduled to expire. This is the same student loan relief that more than 40 million student loan borrowers have received since March 2020. This is the third extension of Biden’s student loan forbearance after President Donald Trump made two extensions of the original student loan relief in the Cares Act, the $ 2.2 trillion stimulus package. The surprise extension means you have an additional three months to figure out your best game plan for paying off your student loan. (Previously, Biden had confirmed the end of student loan relief.)
2. Private student loans still don’t get student loan relief
It is important to note that this student loan relief only applies to federal student loans. (Student loans can be suspended, but here’s why Biden extended student loan relief.) Like the previous student loan forbearance, private student loans are not eligible for this student loan relief. That said, if you have private loans, your lender may offer you different options for forbearance or deferral if you’re having trouble paying off your student loan. (What higher interest rates mean on your student loans).
3. Progressive Democrats are a Powerful Voice for Your Student Loans
Progressive Democrats in Congress such as Senate Majority Leader Chuck Schumer (D-NY), Senator Elizabeth Warren (D-MA), Rep. Alexandria Ocasio-Cortez (D-NY) and Rep. Ayanna Pressley (D -MA), among others led the fight to extend the break in student loan payments. After months of lobbying the president, Biden granted the long-awaited extension. (Here’s how to get a student loan discount during the Biden administration). Without their repeated calls – and the support of several civic and social organizations – to postpone the restart of student loan payments, the temporary student loan forbearance would have expired on January 31, 2022. (That said, don’t expect that Biden cancels student loans before student loan relief ends).
4. Never Say Never With Student Loans
Never say never with student loans. Wait a minute, it looks like there will be no more relief for student loans. Next, there are still three months of student loan relief. (Here’s who qualifies for the student loan waiver right now). The spike in Omicron variant Covid cases, coupled with continued financial hardship for at least some student loan borrowers, are factors that may have led the president to extend student loan relief. The bottom line: Student loan relief is smooth. The Biden administration has continued to demonstrate a strong commitment to student loan borrowers, both providing student loan relief and canceling $ 12.7 billion in student loans.
5. Student loan relief is temporary
While it can be hard to remember the last time you paid off Federal Student Loans, you should remember that this student loan relief is only temporary. Yes, when student loan relief expires on May 1, student loan borrowers will have received more than two years of student loan relief. This student loan relief did not include any mandatory federal student loan payments, no new student loan interest credits, and no collections on delinquent student loans. However, this student loan relief will not last forever. Start figuring out how you’re going to pay off student loans now. Do not wait the last minute. Discover your best options now. Here are some popular ways to pay off student loans faster: