Biden administration officials had told federal student loan servicers to hold off on sending notices to borrowers that their monthly payments would be starting because they were likely to be extended. Susan Rice, the president's domestic policy adviser, was pointed to as a key player in the negotiations for the extension.
She has advocated for each pause on the repayment of student loans since the beginning of the Administration.
A group of Democrats urged the Biden administration to extend the pause on payments through at least the end of 2022. Last week, nearly 100 lawmakers led by Sen. Elizabeth Warren sent a letter to Biden asking him to extend the pause until at least the end of the year.
The chairs of the congressional education committees had urged the administration to extend the relief.
Student borrowers are once again in limbo as Washington plays politics with them. Voters heading to the polls in November will not settle for anything less.
Many progressives want the White House to take executive action to cancel debt. Some more centrist Democrats in Congress, some of whom are up for reelection this year, had also called on the Biden administration to extend the moratorium into next year.
Last month the White House chief of staff signaled that the freeze would be extended again, though some Biden advisers have been reluctant to continue relief because they believe it undermines the administration's messaging on the strength of the economic recovery.
The White House didn't respond to requests for comment.
Democrats and advocates for student loan borrowers say that more relief is needed as Americans face higher costs as a result of rising inflation. Some economists argue that the extension could add to the inflation crisis. The New York Fed warned in a report last month that it expected to see a rise in student loan delinquencies when the federal relief ends.
Congress passed the CARES Act in March 2020 and suspended monthly payments and interest on federal student loans. The Biden administration used executive action to further extend relief.
The Biden administration has been urged to restart student loan payments by Republicans. According to the Education Department, the various extensions of the payment pause have cost more than $100 billion.
According to the Biden administration, borrowers save $5 billion a month in interest that doesn't accrue on their loans.
The Biden administration has been urged to end the program by private student lenders who have been hurt by the relief. They want a partial extension of the relief for borrowers who are struggling.
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