President Joe Biden has instructed the Department of Education to extend federal student loan payment deferrals until October.
The order adds an additional eight months onto a payment pause made possible under a bill passed by Congress at the start of the COVID-19 pandemic. Student loan payments were originally slated to resume as normal at the end of this month.
Now, borrowers paying off federal loans won’t have to make payments until October 1; however they are allowed to continue making payments if they want to.
On the campaign trail, President Biden called for wiping out $10,000 in student debt per borrower. He’s expected to push for it again in an economic relief bill likely to be proposed in February.
Biden has appointed Rohit Chopra, the former student loan ombudsman for the Consumer Financial Protection Bureau (CFPB), to be the CFPB’s executive director. Ashley Harrington, senior counsel at the Center for Responsible Lending, said she believes having Chopra at the helm will likely have positive effects for student loan borrowers.
“Commissioner Chopra has long fought for financial markets that are fair for consumers, including student loan borrowers,” Harrington said. “We are encouraged that the CFPB will now return to its mission of protecting people’s finances, which has heightened significance in this economic downturn, and which includes a strong fair lending program.