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.
White House considering extension of reimbursement pause, spokesperson Jen PsakiJen PsakiHouse Passes Bill Banning Russian Oil Imports, Allowing UK Sanctions to Urge West to ‘Increase Global Pressure on Putin’ Defense & National Security Overnight – US Excluded combat aircraft for Ukraine MORE told reporters last week. His comments follow the chief of staff Ron KleinRon KlainStudent loan companies told not to send resume payment notices: Report Tax groups urge Biden administration to end pause on student loan payments White House hopes for light at end of its tunnel MORE‘s, who said in an episode of the “Pod Save America” podcast that Biden was considering “what we should do on student debt before the break expires, or else he’ll extend the break.”
The payment pause, which first began with a moratorium enacted under then-President TrumpDonald TrumpWhite House praises new South Korea president, citing ‘ironclad’ alliance RNC pursues Salesforce January 6 panel subpoena Russia’s war on Ukraine upends nuclear talks with Iran MORE in March 2020, was 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.