• President Joe biden issued an executive order extending a hiatus on federal student loan payments.

  • The order, which covers the vast majority of all federal student loans, will allow borrowers to defer payments without penalty and reset interest rates to zero.

President Joe Biden issued an executive order on Wednesday to extend a hiatus on federal student loan payments until at least the end of September 2021.

A break on payments first took effect when the coronavirus pandemic began in March 2020, and was extended in December to expire on January 31. Borrowers were able to defer payments without penalty and reset interest rates to zero.

Biden advisers had was clear before the investiture that the new president intended to immediately issue such an order. The ordinance covers the vast majority of federal student loans, but excludes certain federally guaranteed loans that are held by a private lender.

“On day one, the president-elect will call on the Department of Education to extend the existing pause on student loan payments and interest for millions of Americans on federal student loans,” David Kamin, deputy director of the Economic Council Biden National. administration, previously told reporters.

Kamin also told reporters at the time that Biden would like Congress to work to write off the $ 10,000 debt of all federal student loan borrowers, but did not provide details of other measures he was taking. the president could take or would like to see. Other Democratic Party leaders, including Senator Elizabeth Warren (D-Mass.), Have pushed for the cancellation of the $ 50,000 debt of all student loan borrowers by executive order.

It’s unclear what Biden’s choice for Education Secretary Miguel Cardona thinks about student debt cancellation and related issues. Cardona, who has spent his career working in and around K-12 schools, most recently served as the Education Commissioner for the State of Connecticut.

Donald Trump’s Education Secretary Betsy DeVos wrote a letter to leaders of Congress before she stepped down, urging them not to cancel student loans or expand free colleges.

“I hope you also reject the misguided calls to make college ‘free’ and demand that two-thirds of Americans who have not incurred student debt or who have responsibly paid off student loans to pay off the loans of those who have not done the same, ” DeVos wrote in a letter addressed to then Senate Majority Leader Mitch McConnell. “Blanket college debt cancellation is not only unfair to most Americans, it is also the most regressive policy proposition – rewarding the richest sector of our workforce at the expense of the poorest. “


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