The month of August implies that President Joe Biden has one month to declare if he would be reducing student loan borrowers' outstanding debts.
Many debtors have been impatiently awaiting information on what this relief would truly be and when it will affect them since Biden stated in April that he will make a decision about student loan forgiveness "in the coming weeks."
Borrowers Await on Biden's Decision
Although the only assurance Biden has provided thus far is what the relief won't be-a cancellation of $50,000 in debt-he is allegedly considering a $10,000 debt forgiveness for students earning under $150,000 annually, which is more than the amount he promised when campaigning.
Biden has reportedly instructed his Education Department to order loan companies to stop communications surrounding the September 1 payment resume. Biden has already extended the suspension of student loan payments four times, and there is speculation that he may do so once more, as per Insider.
However, Education Secretary Miguel Cardona pledged to give borrowers "ample notice" of any relief, and both activists and politicians have voiced alarm about the lack of information and specifics around any loan forgiveness Biden may be preparing.
More than a hundred Democratic legislators are pleading with the administration to extend the student loan payment suspension on Thursday. The lawmakers said in a letter to the president and Miguel Cardona, the secretary of education, that borrowers across the nation are dealing with a variety of economic problems and that government initiatives are in the works.
A representative for the Education Department told CBS News that the agency would keep track of how the COVID-19 pandemic and the economy are affecting borrowers and that, when a decision is made to terminate the payment freeze, it will get in touch with them directly.
Even if the suspension does end at the end of the month, this does not mean that millions of borrowers' payments will be due on September 1 right away. The Federal Student Aid office said that after the delay is over, borrowers will get a billing statement or other notification at least 21 days before their following payment is due.
Biden Is Expected To Decide Before End of August
Questions linger on whether the Biden administration would take action to cancel student loan debt more broadly, despite ongoing demand to extend the halt. The government "is continuing to explore possibilities for cancellation and no decision has been taken," a White House official stated on Monday.
President Biden stated last month that he will decide on student loans before the end of August. At the time, Biden acknowledged he was exploring canceling $10,000 in student loan debt but ruled out canceling $50,000 per borrower, which some Democrats have campaigned for. In April, he claimed there will be answers on student loan forgiveness in the "coming several weeks."
The Education Department calculated that borrowers had already saved $5 billion a month solely by taking the student loan payment suspension into account. From the beginning of the pandemic to the end of August, it comes to almost $150 billion.
While the Biden administration continues to look into broader student loan debt forgiveness, it has already approved more than $26 billion in targeted student loan forgiveness for more than 1.3 million borrowers through executive action.
This includes roughly $8 billion for those who had been defrauded by schools, nearly $9 billion for borrowers with disabilities, more than $8 billion through the public service loan forgiveness program, and more than $1 billion for those who had been oppressed by predatory lending practices.
According to Forbes, borrowers could receive extra student debt assistance beyond August if Biden continues the payment suspension. However, be sure you're ready in case student loan payments resume.