In a step to ease the student loan payment, the Biden administration plans to freeze federal student loan payments through Aug. 31. The extension of the moratorium will allow millions of Americans to postpone payments during the coronavirus pandemic, according to an administration official familiar with the White House's decision-making.
Student loan payments were scheduled to resume May 1 after being halted since early in the pandemic. But following calls from Democrats in Congress, the White House plans to give borrowers additional time to prepare for payments.
The action applies to more than 43 million Americans who owe a combined $1.6 trillion in student debt held by the federal government, according to the latest data from the Education Department. That includes more than 7 million borrowers who have defaulted on student loans, meaning they are at least 270 days late on payments.
Borrowers will not be asked to make payments until after Aug. 31, and interest rates are expected to remain at 0% during that period. The extension was first reported Tuesday by Bloomberg.
