Student loans

Democrats call on Biden to extend pause in student loan payments

A cohort of House and Senate Democrats write a letter to President Joe Biden asking the administration to extend the pause on federal student loan payments until “at least” the end of the year.


What do you want to know

  • A cohort of House and Senate Democrats have called on President Joe Biden to extend the pause on federal student loan payments until ‘at least’ the end of the year
  • The current pause on federal student loan payments, along with a 0% interest rate on optional payments and a pause on collections for defaulted loans, is set to expire May 1.
  • There are more than 41 million people who collectively owe $1.6 trillion in federal student loan repayments and debt in the United States.
  • In early March, White House Chief of Staff Ronald Klain hinted that the Biden administration was considering another extension of the moratorium.

Federal student loan payments were first suspended when Congress passed the CARES Act in March 2020 under the Trump administration, and the moratorium was originally scheduled to expire in September of that year. Trump and Biden subsequently extended the hiatus, with the final extension coming from the White House in late December 2021.

Biden’s order, which also included a 0% interest rate on payments and a pause on collections for defaulted loans, is set to expire on May 1.

On Thursday, the group of lawmakers, which includes Senate Majority Leader Sen. Chuck Schumer, D.N.Y., Sens. Elizabeth Warren, D-Mass., Alex Padilla, D-Calif., and Raphael Warnock, D-Ga., and Reps. Ayanna Pressley, D-Mass., Ilhan Omar, D-Minn., Pramila Jayapal, D-Wash ., and House Majority Whip James Clyburn, DS.C., urged the president to issue another break — and even a longer extension.

“We are writing to urge you to act now to extend the pause on federally held student loan payments until at least the end of the year and to provide meaningful student debt cancellation,” wrote in part the group of lawmakers, adding: “While there may be different ideas about how best to structure cancellation, we all agree that you should cancel student debt now.

There are more than 41 million people who collectively owe $1.6 trillion in federal student loan repayments and debt. The average individual with federal student loans has $37,113 in debt, according to the Education Data Initiative.

In Thursday’s letter, lawmakers also pointed to socioeconomic and racial disparities among those who take out federal student loans, saying “the student loan system reflects many of the inequalities that plague American society and widen the gap in racial wealth.

According to EDIwhile white Americans hold 54% of federal student loan debt, black Americans have, on average, $25,000 more in student debt than their white counterparts and are the second most likely demographic group, behind Native American borrowers and Alaska Natives, to have payments exceeding $350 per month.

Non-white student borrowers tend to struggle to repay their loans at the same rate as white borrowers due to composite barriers such as the growing racial wealth gap, wage disparity and other forms of discrimination.

“As your administration works to rebuild a fairer and fairer economy, it should use its administrative powers to address this crisis and provide permanent relief to the millions of borrowers struggling with this debt,” the ministers wrote. Democrats to Biden. “Cancelling a significant amount of student debt will bring long-term benefits to individuals and the economy, helping families buy their first home, open a small business or invest in their retirement.”

Lawmakers wrote they were encouraged after White House Chief of Staff Ronald Klain hinted in early March that the Biden administration was considering a further extension of the moratorium, telling the Pod Save America podcast: “President going to consider what we should do about student debt before the break expires, or he will extend the break.

The lawmakers who signed Thursday’s letter are not alone in their party lobbying on the issue of federal student loan forgiveness.

Sen. Patty Murray, D-Wash., Chair of the Senate Committee on Health, Education, Labor and Pensions, called in mid-March for the Biden administration to extend the payment break until 2023 at least, also proposing a number of measures to “fix our student loan system for good.

In the House, Rep. Alexandria Ocasio-Cortez, a longtime supporter of student loan forgiveness, blasted President Biden’s failure to mention the issue during his State of the Union address. beginning of March, telling MSNBC: “Things like student loan debt, broader education themes and crises, and the immigration article were really glossed over.”