Here are reasons why President Joe Biden should extend the student loan payment pause and why he shouldn’t.
Here’s what you need to know.
Student loan payments for federal student loans are expected to restart on May 1, 2022. Advocates have lobbied the president to extend student loan relief for a fourth time. (Will student loan payments get postponed until 2023?). As the White House notes, student loan borrowers haven’t been required to make a single federal student loan payment since Biden became president. Similarly, borrowers weren’t required to make any federal student loan payments during the final 10 months of the Trump administration.
Here are the reasons why Biden should extend student loan relief again, and here are the reasons why he shouldn’t.
Why Biden should extend student loan relief
Advocates argue that Biden should extend student loan relief because:
- Student loan borrowers are struggling financially;
- More student loan relief is necessary in the wake of the ongoing Covid-19 pandemic (Biden agrees to stop challenging student loan forgiveness after public outcry);
- Democrats could lose the midterm election in November if student loans aren’t paused again;
- There’s no law prohibiting the president from extending student loan relief; and
- It’s the right thing to do in an uncertain economic environment.
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Why Biden shouldn’t extend student loan relief
Opponents of extending student loan relief argue that:
- Student loan borrowers haven’t been required to pay federal student loans for nearly two years since March 2020;
- By May, the student loan payment pause collectively will have cost the federal government more than $130 billion in uncollected student loan interest;
- Democrats could lose the midterm election if the student loan payment pause is extended because independent and moderate voters may be alienated;
- The Covid-19 pandemic is much different today than it was in March 2020; and
- The economy has rebounded significantly and unemployment is near all-time lows.
Student loans: next steps
The White House hasn’t made any announcement on potentially extending student loan relief. The president is expected to weigh several factors before making a final decision. That said, the White House and the U.S. Department of Education consistently have referenced May 1 as the start date for student loan payments to restart.
Now is the time to plan for the return to student loan repayment. Absent any extension, make sure you know all your options. Here are some smart ways to pay off student loans: