Biden administration plans to extend payment break for student loan borrowers

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President Joe Biden addresses graduates of South Carolina State University during their graduation ceremony on December 17, 2021.

Mandel Ngan | AFP | Getty Images

The Biden administration is considering further extending the payment break and interest waiver for most federal student loan borrowers.

“Since day one of the Biden administration, we have worked hard to provide meaningful relief for student loan borrowers,” a spokesperson for the US Department of Education told CNBC on Tuesday.

“It started with an extension of the break on federal student loan repayments until Jan. 31, 2022,” the spokesperson said. “Later this week we will announce whether to extend the break.”

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As of March 2020, borrowers have the option of pressing the pause button on their monthly bills with no accrued interest on their debt. Almost all borrowers accepted the relief, according to research.

The hiatus is currently scheduled to expire at the end of next month.

Still, Democrats and supporters have pressured President Joe Biden to give the 42 million Americans in debt more time. Recent concerns about the new variant of omicron have made these discussions more urgent.

The stock of student debt in the United States has exceeded $ 1.7 trillion and weighs more on Americans than credit card and car debt. About a third of borrowers are in default or in default. The average monthly payment is around $ 400 per month.

A recent survey of student loan borrowers found that about 90% are still not financially secure enough to resume their payments.

This is last minute news. Please check for updates.

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