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Dive Brief:
- Student loan borrowers will have to repay their debts again starting the end of August under legislation President Joe Biden signed Saturday.
- The pandemic-era repayment freeze will end 60 days after the end of June, which is Aug. 29. This date was included in the legislative deal raising the U.S. debt ceiling.
- The Biden administration had said it intended to restart monthly payments 60 days either at the end of June, or after the U.S. Supreme Court ruled on the president’s plan to forgive student loan debts for those earning up to $125,000 a year.
Dive Insight:
Former President Donald Trump instituted the payment freeze in the early days of the COVID-19 health crisis. But it has since been extended eight times, drawing the fury of Republican lawmakers who said it’s unnecessary as pandemic restrictions ease and the economy recovers.
Congress also passed legislation recently that would walk back the most recent extension, which happened in November, and would retroactively impose interest that would have accrued in the past few months.
That legislation, which Biden is expected to veto, would also strike down his proposed loan forgiveness program. However, the Supreme Court is already forecasted to rule against the plan.
