Biden cancels some student loan debt, extends pandemic payment pause

The largest forgiveness of federal student loans per individual to date was announced by President Biden on Wednesday.

The payment freeze on federal student loans and interest accrual was extended by Biden against an August 31 deadline that would have caused bills to go back into effect just before the elections.

There is a payment pause in effect until the end of the year.

According to multiple sources, the White House will announce a plan to cancel some student loan debt and an extension of the current pause. It was within the smallest window of time for borrowers to decide when their payments would resume that the announcement was made.

The freeze on loan payments was put in place by former President Trump in March of 2020. The debt of more than 40 million Americans was put on hold as a result of Trump's order.

While the cancelation will be celebrated as the most far-reaching move to help student loan borrowers, activists and some Democrats will also likely call for more in student loan forgiveness.

The idea of means-testing to decide which borrowers are granted student loan forgiveness was opposed by the White House after it was reported that it would limit relief to people earning less than $125,000.

Biden told reporters last month that he would make a decision on student loans at the end of August.

A decision on the matter will be made within a week.

The end of the freeze will be communicated to borrowers directly by the Education Department.

Democrats and advocates want Biden to act on student loans forgiveness.

The economic hardship some have faced due to the coronaviruses epidemic, as well as the squeeze rising inflation has put on consumers nationwide, was cited in the letter signed by over 100 Democrats in Congress.

In May, Senate Majority Leader Charles Schumer (D-N.Y.), Sen. Elizabeth Warren (D-Mass.) and Sen. Schumer is one of the Democrats who have pressed for debt cancellation.

The White House was under pressure to offer more relief after Biden said he would cancel billions of dollars in student debt for Corinthian College students.

Biden asked for a memo from the Department of Education to determine his authority to forgive student debt. The administration has not made a public announcement if the memo is complete.

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