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Student loan companies ordered not to send CV payment notices: report

The Biden administration is ordering businesses not to send notices about resuming student loan payments in May, warning that the two-year payment freeze could be extended again.

The Department of Education has told companies that service federal student loans to suspend notices to borrowers about restarting payments, CNBC reportedciting two people familiar with the matter.

When asked to confirm the directive to businesses, a Department for Education spokesperson told The Hill that the agency communicates regularly with repairers.

“The Department will continue to communicate directly with borrowers about federal student loan repayments by providing clear and timely updates. The department’s Federal Office of Student Aid will also continue to communicate regularly with servicers about the type and cadence of servicer outreach to borrowers,” the spokesperson said.

The White House is considering an extension of the reimbursement pause, press secretary Jen Psaki told reporters last week. His comments follow those of chief of staff Ron Klain, who said in an episode of the “Pod Save America” ​​podcast that Biden was looking at “what we should do on student debt before the break expires, if not. he will extend the break”.

The payment pause, which began with a moratorium enacted under then-President Trump in March 2020, has been extended five times. It is set to expire on May 2 after Biden extended it in January.

“That’s obviously something that we’ll continue to access and look at as we get closer to May. Typically there’s a period of time where you have to make a decision, or you have to at least indicate lenders what they need to prepare for, but I have nothing to predict at the moment,” Psaki said on Friday.

Biden made no mention of student loans during the State of the Union address last week. In April, he requested a memo from the Department of Education to determine its authority to cancel student debt through executive action. Since then, the administration has not publicly announced whether the memo is complete.

Biden has campaigned in 2020 to forgive at least $10,000 in federal student loans per person, and progressives have called on him to increase that number to $50,000 per borrower.

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