The Biden administration is extending its student loan repayment pause — which was set to expire at the end of the year — into 2023 while its promise of federal relief remains hung up in court.
Payments will resume 60 days after the debt cancellation program is implemented, 60 days after the lawsuits are resolved or 60 days after June 30, if litigation fails.
Borrowers have been off the hook for federal student loan payments more or less since the COVID-19 pandemic began in early 2020. The repayment pause has been extended multiple times since, and Biden’s previous extension to Dec. 31 was supposed to be the last.
Tuesday’s extension, the White House said, will alleviate uncertainty for borrowers as the administration asks the Supreme Court to review lower-court orders blocking Biden’s student debt relief program.
“I’m confident that our student debt relief plan is legal. But it’s on hold because Republican officials want to block it,” Biden tweeted. “That’s why [Secretary of Education Miguel Cardona] is extending the payment pause to no later than [60 days after] June 30, 2023, giving the Supreme Court time to hear the case in its current term.”
Biden announced his plan to relieve up to $10,000 in federal student loan for low-to-middle-income borrowers — up to $20,000 for qualifying Pell Grant recipients — in August, but was quickly met with Republican opposition.
And earlier this month, a federal judge in Texas deemed Biden’s program unlawful, though the Department of Justice has appealed the decision. Additionally, in a separate lawsuit, a federal appeals court issued an injunction to Biden’s relief on behalf of six states, which argued financial institutions would be harmed if borrowers didn’t have to pay their outstanding balances.
The Biden administration asked the Supreme Court to look into the matter in hopes of pushing the program through.
In a statement Tuesday, Secretary of Education Miguel Cardona called Republican efforts to block the relief “callous” and “just plain wrong.”
“I want borrowers to know that the Biden-Harris administration has their backs and we’re as committed as ever to fighting to deliver essential student debt relief to tens of millions of Americans,” Cardona said.
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