Student Loan Payment Pause Could Be Extended Again


U.S. Secretary of Education Miguel Cardona says the student loan payment pause could be extended beyond August 31, 2022.

Here’s what you need to know — and what it means for your student loans.

Student Loans

During a U.S. Senate Appropriations Subcommittee hearing yesterday, U.S. Secretary of Education Miguel Cardona raised the possibility of yet another extension of the student loan payment pause.

Here’s the exchange:

Sen. Jean Shaheen: “Unfortunately, over that last year, the [Biden] administration has made three, last-minute extensions of the current [student loan] payment moratorium. I am sure that all of those recipients appreciate that, but it doesn’t provide the kind of certainty that they really need as they’re planning their lives…So, do you have any sense of when this current moratorium will end?”

Secretary of Education Miguel Cardona: “I don’t have any information now to share with you about when it would end or…what the conversations are about, when it’s going to be lifted. I know we have a day, and it could be that it’s extended or it could be that it starts there. But I will say is that our borrowers will have ample notice and we’ll communicate that with you as well.”

Student loan payment pause: analysis

Let’s analyze Cardona’s comments.

  • Decision on student loan payment pause: First, Cardona didn’t say President Joe Biden hasn’t decided on wide-scale student loan cancellation or the student loan payment pause. Rather, Cardona said he didn’t have “any information to share.” This could imply that a decision has been made but that Biden or he is not announcing that decision now. Alternatively, Cardona’s statement could mean no decision has been reached.
  • End of student loan payment pause: Second, “I know we have a day” likely refers to August 31, 2022, which is when temporary student loan relief from Covid-19 is scheduled to end. Since March 2020, student loan borrowers haven’t been required to pay a single dollar of federal student loans. Both President Donald Trump and Biden collectively have extended student loan relief six times. Congress passed record student loan relief in March 2020 through the Cares Act, the $2.2 trillion stimulus bill, in response to the Covid-19 pandemic.
  • Extension of student loan moratorium: While Cardona didn’t commit to an extension of student loan relief, Cardona raised the possibility that this may not be the end of the student loan payment pause. That said, he assured student loan borrowers that they will have “ample notice” regarding the restart of student loan payments. However, the restart of student loan payments is less than three months from now. So, “ample notice” may be less time than you need to prepare for the restart of your student loan payments.

What this means for your student loans

Here’s what this means for your student loans. While student loan borrowers are awaiting more clarity on student loan forgiveness and the student loan payment pause, the Biden administration isn’t rushing to provide an answer. The White House denied that Biden has decided to cancel $10,000 of student loans, saying the president hasn’t yet decided. Biden also said he won’t cancel $50,000 of student loans. However, there could be a renewed push from progressive Democrats for Biden to reconsider $50,000 of student loan forgiveness. Cardona didn’t commit to an extension of the student loan pause, but he also didn’t deny that student loan payments will restart beginning on September 1, 2022, as currently scheduled. This leaves student loan borrowers in student loan limbo until the Education Department provides further clarity on the next steps for student loan repayment. Biden has canceled $25 billion of student loans and extended the student loan payment pause four times. Biden could announce his decision on broad student loan forgiveness later this summer, which would coincide with the end of the student loan payment pause. If you have student loans, you should prepare as if your student loan payments restart after September 1. The best way to prepare for student loan repayment is to learn all the ways you can pay off student loans faster. Here are some popular ways to save money and conquer student loan debt:

Student Loans: Related Reading

Senators propose major changes to student loan forgiveness

Education Department announces major overhaul of student loan servicing

Navient agrees to cancel $3.5 million of student loans

How to qualify for $17 billion of student loan forgiveness


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Natasha M. McKnight

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