Education Department Confirms Student Loan Repayments Will Start Soon

United States North America International Studies Higher Education News by Erudera News May 25, 2023

woman counting dollars

Student loan borrowers will soon have to start repaying their loans after a three-year pause on payments, the US Education Department has confirmed.

The precise date when repayments will begin is still uncertain as it also depends on Supreme Court’s ruling on the student loan forgiveness plan, Erudera.com reports.

However, Education Secretary Miguel Cardona said last week that student loan payments would resume 60 days after the Supreme Court decides on Biden-Harris Administration's student debt relief plan or 60 days after June 30, whichever happens first. That means borrowers might have to begin paying for their student loans in August or September.

“We communicated that after the Supreme Court decision is made, loan repayments will start within 60 days of the decision,” Cardona said during a hearing held by the House Committee on Education and the Workforce on Tuesday.

Several days ago, Cardona testified before the Senate Committee on Appropriations, where he also confirmed payments will resume no later than June 30 but added the Department is also waiting for the court’s decision on the plan.

Earlier this month, the US Department of Education announced it had approved $42 billion in Public Service Loan Forgiveness (PSLF) for more than 600,000 borrowers since October last year. Additionally, the Department said improvements will be made to the PSLF Help Tool, which borrowers can use to apply for the student loan forgiveness plan.

“To date, the Biden-Harris team has kept that promise for more than 615,000 teachers, nurses, social workers, service members, and other public servants by approving a combined $42 billion in student loan debt forgiveness,” Cardona said in a statement issued early in May.

Former President of the United States, Donald Trump, froze federal student loan payments in March 2020 as a pandemic relief. Since then, the two administrations extended the pause on payments eight times.

As a presidential candidate, Joe Biden promised to cancel up to $10,000 in federal student loans for every borrower.

But several lawsuits blocked the debt relief plan, contesting the President’s authority to cancel millions of dollars under a 2003 law called the Higher Education Relief Opportunities for Students Act.

On February 28, 2023, the Supreme Court heard oral arguments in two cases blocking the plan. The court’s conservative majority appeared skeptical of the legality of Biden’s plan to wipe out more than $400 billion in student debt in the next 30 years.

>> US Education Secretary: We Know Student Loan Debt Relief Is Essential & We Are Fighting to Offer It

Photo: Alexander Grey | Unsplash

Related News

Yale University

Yale University has joined Dartmouth College in reintroducing the standardized testing requirement for applicants after nearly four years with a test-optional policy, the school has announced.

United States

Feb 26, 2024

Biden

Since the Supreme Court struck down US President Joe Biden’s debt relief plan last summer, the administration has been working on delivering a new plan for student loan borrowers.

United States

Feb 23, 2024

joe biden

US President Joe Biden has approved $1.2 billion in student loan forgiveness for almost 153,000 borrowers, the US Department of Education has announced.

United States

Feb 22, 2024