Suspension of student loan payments extended until January 31 – KIRO 7 news Seattle


WASHINGTON, DC – People preparing to resume their student loan payments can wait another month.

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Education Secretary Betsy DeVos announced on Friday that the moratorium on student loan repayments has been extended until January 31, 2021.

Borrowers have not had to make payments since March but had the option of continuing to repay their principal. The relief was scheduled to expire on December 31.

“The coronavirus pandemic has presented challenges for many students and borrowers, and this temporary pause in payments will help those who have been affected,” DeVos said in a statement. “Overtime also allows Congress to do its job and determine what action it deems necessary and appropriate. Congress, not the executive branch, is in charge of student loan policy.

DeVos also extended the pause on accrued interest, as well as the suspension of collections on overdue loans, the statement said. Non-payments will continue to count towards the number of payments required under an income-based repayment plan.

DeVos suspended federal student loan payments in March, and Congress passed legislation two weeks later in a $ 2 trillion economic stimulus package.

The original deadline was September 30, but President Donald Trump then extended the pardon until December, the Washington Post reported.

In Friday’s statement, DeVos called on employers to continue to suspend wage garnishments for borrowers with past due federal student loans. All defaulting borrowers who continue to have their wages garnished will receive repayments.

The suspension and waiver of interest only apply to loans held by the federal government, CNN reported. This covers about 85% of all federal student loans, including Federal Direct Loans and PLUS Loans, that parents can take out on behalf of their children.

“We are pleased that Secretary DeVos has responded to this call,” Alexis Goldstein, senior policy analyst with America’s Progressives for Financial Reform, told the Post. “But we still need a long-term solution. We look forward to seeing the new Biden administration further extend the suspension of federal student loans, ensure that all federal student loan borrowers are covered, and bring crucial relief to millions of people by forgiving federal student debt through debt relief. ‘executive action. “

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