Student Debt Reprieve: Could Payments Be Paused Again as White House Mulls Executive Action?
A White House official said the Biden administration is considering extending the pause on student loan payments — currently set to expire in less than two months — though nothing official has yet been decided.
White House Chief of Staff Ron Klain said on the “Pod Save America” podcast last week that a decision on whether to forgive student debt through executive action will be made before the payment pause expires on May 1, CNBC reported.
“The president’s going to look what we should do on student debt before the pause expires, or he’ll extend the pause,” Klain said. “The question [of] whether or not there’s some executive action [on] student debt forgiveness when the payments resume is a decision we’re going to take before the payments resume.”
Student loan payments were paused in March 2020 as part of the federal government’s effort to help Americans deal with financial fallout from the COVID-19 pandemic. The pause has already been extended several times, most recently in December 2021, when President Joe Biden pushed the date back to May 1 from its earlier expiration date of Jan 31.
Some lawmakers and consumer advocates want to see Biden take a more proactive stance on student debt, but so far that hasn’t happened. As previously reported by GOBankingRates, Congressional efforts to forgive all student debt have stalled, so the focus has turned to convincing Biden to take executive action that would forgive up to $50,000 in debt per borrower. Others have suggested a smaller, $10,000 debt forgiveness.
Many Democrats support such an action, but just as many Republicans oppose it. Opponents say forgiving student debt for current borrowers would be unfair to those who have already paid their loans. Supporters counter that providing financial relief so borrowers can save for retirement or purchase homes would have a longer-term economic benefit.
For now, however, no forgiveness packages have been approved. And as of Monday morning, no official decision had been made on extending the payment pause.
“Right now people aren’t having to pay on their loans,” Klain said on the podcast. “And so I think dealing with the executive branch question — what we should do about that, what his powers are, how much we should do –that’s something we’re going to deal with later on.”
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