The US Department of Education has paused the payments on federal student loans for the sixth time since the beginning of the Pandemic.
This time, borrowers will not have to resume their bills until September. Here is what borrowers need to know.
President Joe Biden has said it's too early to ask borrowers to start paying their student loan bills after the pause on federal student loan bills was first announced in March 2020.
Biden said in an April 6 statement that we are still recovering from the Pandemic and the economic disruption it caused.
Part of the delay is due to the fact that the White House is still considering student loan forgiveness.
Biden is under tremendous pressure to reduce some of the country's education debt. Schumer and Warren are pushing him to cancel the loans.
More than 70% of Latino and Black voters are in favor of the president forgiving student debt, according to a recent poll.
The White House wanted to make a decision on loan forgiveness before turning back payments.
The president will either extend the pause or look at what we should do about student debt.
Because the payment pause has been extended so many times, experts say borrowers are unlikely to take the latest announcement of bills resuming in September too seriously.
Scott Buchanan is the executive director of the Student Loan Servicing Alliance, a trade group for federal student loan service.
This time, the payments are scheduled to start again just a few months before the elections, which could lead to troubling headlines for Democrats and lower turnout at the polls for the party.
I can't see them restarting repayment two months before an election.
The interest on federal student loans will remain suspended. The Federal Reserve found that borrowers have saved $200 billion during the break.
The policy does not cover holders of Federal Family Education Loans and private student loans, meaning their debt will continue to grow with interest.
The temporary suspension of interest may be used by borrowers who can't afford it. Experts warn that there are exceptions.
It's a bad idea to continue making payments if you're pursuing public service loan forgiveness.
The months of the payment pause count toward the eventual debt forgiveness these programs lead to, whether or not you are paying or not, and so any money you direct to your loans during this reprieve just reduces the amount of forgiveness for which.
According to experts, the Covid Pandemic has taught us how important it is to have a healthy savings account. They say that people should build up at least six months worth of emergency savings.
It's a good time to make progress on paying your student loans because interest rates are at zero. Credit cards have an average interest rate of more than 16%.
Ted Rossman, an industry analyst at Creditcards.com, said to make sure you have enough in your emergency savings account.
Your credit limit shouldn't be used as a safety net.
Many people had their credit card limits cut unexpectedly over the past year as they were worried about risk.
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