On Aug. 24, 2022, President Biden announced an extension of the pause on student loan repayment through December 31, 2022, along with a plan to forgive a certain amount of student loan debt for certain individuals.
The Details:
The Coronavirus Aid, Relief, and Economic Security Act (“CARES Act”) was signed into law on March 27, 2020. The CARES Act was the third stimulus bill aimed at providing relief to employers and individuals affected by COVID-19. One of the provisions of the CARES Act addressed federal student loans.
Under the CARES Act, repayment of certain federal student loans, including direct loans, Perkins loans and Federal Family Education Loans owned by the United States Department of Education, were automatically suspended from March 13 through September 30, 2020. In addition, interest did not accrue and collection actions and wage garnishments for student loans ceased. Private student loans did not qualify for the relief.
Subsequently, President Biden extended the pause on student loan repayment several times, with the last extension set to expire on August 31, 2022. Then, on August 24, 2022, President Biden announced another extension.
Latest Extension:
On August 24, 2022, President Biden announced:
To ensure a smooth transition to repayment and prevent unnecessary defaults, the pause on federal student loan repayment will be extended one final time through December 31, 2022. Borrowers should expect to resume payment in January 2023.
Student Loan Debt Forgiveness:
In addition, the President announced a plan that allows for a certain amount of student loan debt forgiveness for individuals earning less than $125,000 ($250,000 if married filing jointly).
For more information on the extension of the student loan repayment pause and the details of the student loan debt forgiveness, click on the link provided below.
https://www.whitehouse.gov/briefing-room/statements-releases/2022/08/24/fact-sheet-president-biden-announces-student-loan-relief-for-borrowers-who-need-it-most/
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