Major Updates

Biden Administration Extends Student Loan Pause Through August 31; Signals Debt Cancellation

Citing the ongoing COVID pandemic and the economic consequences of it, Federal Student Aid (FSA) has extended the federal student loan relief to borrowers which began in March 2020 through August 31, 2022. All student loans that are federally held will have their payments automatically suspended until that date without penalty. In addition, there will be a 0% interest rate on these loans through the end of August.

In recent days, lawmakers and the Administration have been discussing the topic of student loan debt cancellation, a topic which has persisted throughout the Biden presidency. It seems like with the pause in student loan payment, the August deadline, and a potentially tricky midterm election for Democrats, there may be some movement on this issue. Democratic rank and file largely want the President to cancel $50k per borrower, not dependent on income bracket or school attended. President Biden himself however, has made comments stating he’d like a lower amount. And, in the past, he has stated it should only go to those who may be in most need, as well as that he did not think that those who attended elite institutions should be eligible, something he has seemed to move away from with comments in recent days.

The Administration has been aggressive in its approach to the relief it can provide student borrowers, having forgiven more than $17 billion since taking office on defrauded and disabled students, Public Service Loan Forgiveness, and borrowers in income driven repayment programs. Read more.

Other News

• Department of Education moves to make owners, investors, and controlling parties responsible for college and university liabilities (REGucation by Thompson Coburn LLP)
• U.S. Department of Education Announces Expansion of Second Chance Pell Experiment and Actions to Help Incarcerated Individuals Resume Educational Journeys and Reduce Recidivism (U.S. Department of Education)