The student loan pause has been extended. This is great news for you and your family if you are student loan borrowers who were looking forward to the relief that this extension would bring. Student loans can be a burden to your budget and they often create stress for those who are struggling with debt, as well as those who are not struggling with debt but want to help out their family members or friends in need of assistance.
The Biden administration has announced that it will be extending the student loan pause through May 1, 2022. This means that borrowers will not have to make any payments on their loans during this time period. In a statement, the Biden administration said that this extension would help millions of borrowers nationwide who are struggling to keep pace with their student loans.
What Does This Pause Mean?
The United States Department of Education announced a 90-day extension of the moratorium on student loan repayment, interest, and collections until May 1, 2022. The extension will allow the Administration to examine the effects of the Omicron variation on student borrowers, as well as give borrowers more time to plan for payment resumption and lower the risk of delay and default after the resumption. The Department will continue its efforts to ease borrowers' return to repayment, including by strengthening student loan servicing.
The postponement of student loan payments will save 41 million borrowers. Borrowers are encouraged to take advantage of the extra time to update their contact information and to consider enrolling in digital payment and salary repayment plans to ensure a better transition to repayment.
What Does It Mean for People With Student Loans?
You can take advantage of the extra time to take a look at your finances and explore repayment options. You can also see what progress you have made. There's no penalty for paying back the loan early, which is something that you should consider if you are able to do so. This means that if you obtain federal student loans to pay for your college education, you will not be responsible for paying interest on those loans during your grace period of six months.
This is a piece of good news for you as a student, particularly those who will be able to save hundreds or even thousands of dollars of interest that they would have otherwise had to pay. This is a great way for the Administration to help those who are struggling with college debt and help them to get out of it even sooner.
The Biden student loans pause is a great opportunity for those of you who have been struggling with your debt and repayment. If you are having difficulty making your monthly payments, the Biden administration’s extension of this program might be just what you need to get back on track.
If you are not yet behind on your payments, this will be a definite lifesaver. Now is the time to take charge of your student loan debt and consolidate it into a manageable repayment plan.