What is the future of student loans?
But POLITICO reports that the final version of the stimulus package poised to pass Congress includes no further extension of student loan relief. And the billions of dollars allocated towards the student loan relief extension that was present in the earlier draft summary is not listed in a summary of the latest bill. That means that borrowers may have to plan on resuming their payments shortly after January 31. Biden Could Still Extend Student Loan Relief Despite the bad news for student loan borrowers, President-elect Biden could still further extend the moratorium on student loan payments, interest, and collections via executive order once he takes office on January 20, just as the Trump administration did in August and again earlier this month, particularly if the economy does not show signs of improving. Biden has previously expressed a willingness to enact executive orders as necessary to bolster the economy. However, student loan servicers and some consumer advocates have expressed concern about the short time window between January 20 (when Biden would be sworn in) and January 31 (when student loan relief ends). Preparing to transition millions of borrowers back into repayment, and then halting the process less than two weeks from expected implementation, could cause administrative problems and further headaches for struggling student loan borrowers. In a recent survey by Student Debt Crisis and Savi, 77% of student loan borrowers covered by the moratorium indicated that they do not feel financially secure enough to resume their student loan payments, and more than half of surveyed borrowers rate their current financial wellness as poor or very poor since the pandemic began in earlier this year.
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January 2021 | The Business Review
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