Included in this proposal is $4 billion dedicated to student loan relief. What The Election Results Mean For Student Loan Borrowers, Biden's Victory Means DeVos Is Out By January. Included in the larger, more popular portion of the stimulus package is an extension of existing student loan relief to April 1, 2021. "I can speak for the Republican side. Education Secretary Betsy DeVos has extended an existing moratorium on student loan payments, interest, and collections into 2021. In addition, many student loan servicers have voluntarily pushed annual recertification deadlines for income-driven repayment plans well into 2021, meaning many borrowers may not have to take action on their loans for several more months. Congress May Be Poised To Extend Student Loan Relief Further Into 2021 Forbes - Adam S. Minsky, Esq. during "Mornings With Maria" at Fox Business Network Studios on February 20, 2020 in New York City. Adam S. Minsky is an advocate, innovator, and entrepreneur who established a unique law practice devoted entirely to assisting student loan borrowers and their families. Recognized as a national authority on student loan law and policy, Adam has forged substantial connections with consumer advocates, government agencies, elected officials, media groups, and nonprofit organizations to effectuate systemwide change. Advocates and members of Congress have proposed various measures to extend the student loan payment pause, ranging from March 31, 2021 to September 30, 2021. The White House has been pushing its own version of a new stimulus package that excludes an extension of student loan relief. The other part would contain the more controversial elements — namely, funding for state and local governments (which Democrats want), and a COVID-19 liability shield (which Republicans want). A bigger Social Security paycheck, more enhanced unemployment and student loan forgiveness are … In a recent survey by Student Debt Crisis and Savi, 77% of student loan borrowers covered by the moratorium indicated that they do not feel financially secure enough to resume their student loan payments, and more than half of surveyed borrowers rate their current financial wellness as poor or very poor since the pandemic began in earlier this year. ... 2021, have stalled. WASHINGTON – U.S. Secretary of Education Betsy DeVos announced today the extension of the federal student loan administrative forbearance period, the pause in interest accrual, and the suspension of collections activity through January 31, 2021. Consumer rights advocates and progressive Democrats in Congress are pushing Biden to use executive action to enact sweeping student loan relief, including an extended moratorium on payments as well as broad student loan forgiveness. How Trump intensified the GOP’s war on reality; Fauci recommends Trump and Pence get vaccinated for Covid-19; Rep. Paul Mitchell ‘Disaffiliating’ From GOP Because It Can’t Admit Trump Lost We want to make a law to agree where we can and help people who need," Senate Majority Leader McConnell (R-KY) said yesterday. Servicers would have started generating reminder notices for student loan bills as early as next week. The emergency pandemic stimulus legislation also stopped all collections efforts on defaulted federal loans, such was wage garnishments and interceptions of federal tax refunds. March 27, 2020 – Congress passes the CARES Act. Over $300 billion in commercially-held FFEL loans, federal Perkins loans issued by colleges and universities, and private student loans were excluded from the original CARES Act. 1 week Congress May Be Poised To Extend Student Loan Relief Further Into 2021 Forbes . … ... is extended through January 2021 … Federal student loan relief will now stretch ten months. As I stated in my proposal for college debt relief, writing off only $17,000 of debt per debt holder would wipe out the obligation of a majority of student loan debt holders in America. Congressional Democrats have been pushing to further extend student loan relief well into 2021 as part of larger stimulus negotiations. But the Democratic-controlled House and Republican-led Senate have been at an impasse for months. 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Included in the larger, more popular portion of the stimulus package is an extension of existing student loan relief to April 1, 2021. He has expressed a preference for Congress to take action. 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New Proposed Stimulus Bill Could Extend Student Loan Relief And Unemployment Benefits - But Includes No Cash Payments, Will Trump Extend Student Loan Relief? The U.S. Department of Education announced the update in a press release on Friday. Borrowers should contact their loan servicers for additional information. This legislation suspended all payments and interest on government-held federal student loans. August 8, 2020 – President Trump extends the student loan relief. Opinions expressed by Forbes Contributors are their own. Recognized as a national authority on student loan law and policy, Adam has forged substantial connections with consumer advocates, government agencies, elected officials, media groups, and nonprofit organizations to effectuate systemwide change. For much of 2020, millions of student loan borrowers have not had to repay their federal student loans because of emergency pandemic relief under the CARES Act. The federal student loan payment pause is extended through Jan. 31. Non-payments will continue to count toward the number of payments required under an income-driven repayment plan, a loan rehabilitation agreement, or the Public Service Loan Forgiveness program.”. All Rights Reserved, This is a BETA experience. (Photo by John Lamparski/Getty Images). President-elect Biden's 2021 stimulus plan: Will you get a second check or not? Senate Minority Leader Chuck Schumer (D-NY) echoed that sentiment on behalf of Senate Democrats. If you are a recent medical grad, chances are good you have outstanding student loans. A bipartisan group of senators has released the text of a proposed second stimulus bill, and it contains some good news for certain student loan borrowers. Could Biden Cancel Some Student Debt Through Executive Action? Education Secretary Betsy DeVos has extended an existing moratorium on student loan payments, interest, and collections into 2021. House Democrats passed legislation that would push the student loan moratorium’s expiration to September 2021. We May Know Soon. Relief for student borrowers had been scheduled to expire at the end of the year. DeVos Extends Federal Student Loan Payment Suspension Into 2021. A bipartisan group of senators unveiled a new, $900 billion stimulus bill this week designed to revive efforts to reach a compromise on broad economic relief before the end of the year. "The added time also allows Congress to do its job and determine what measures it believes are necessary and appropriate.”. The Education Department gave millions of Americans a brief reprieve Friday when it extended a payment pause for federal student loans for an additional month. The two sides have had months to pass another relief bill. YES: The employment conditions that supported the federal government’s decision to offer loan relief in March 2020 will still exist in early 2021. 0. Congress May Be Poised To Extend Student Loan Relief Further Into 2021. NEW YORK, NEW YORK - FEBRUARY 20: Anchor Maria Bartiromo interviews Education Secretary Betsy Devos ... [+] during "Mornings With Maria" at Fox Business Network Studios on February 20, 2020 in New York City. SHARES. NEW YORK, NEW YORK - FEBRUARY 20: Anchor Maria Bartiromo interviews Education Secretary Betsy Devos ... during "Mornings With Maria" at Fox Business Network Federal student loan borrowers will not be expected to make payments through January of next year, though they will continue to be able to do … For millions of student loan borrowers who have benefited from payment relief during the coronavirus pandemic, the payments will resume beginning Jan. 1, 2021. The survey found that healthcare workers were particularly concerned. You may opt-out by. The Department of Education just announced an extension of the student loan moratorium to January, 31, 2021. The U.S. Department of Education announced the update in a press release on Friday. He is also an experienced public speaker, consultant, and writer on student loan-related topics. Passage of the current stimulus proposal is by no means guaranteed, but Congressional leaders have expressed optimism. Here’s the latest. © 2020 Forbes Media LLC. The student loan moratorium was originally supposed to end in September, but President Trump subsequently extended that relief to December 31. If nothing else changes between now and year end, then the current, temporary student loan relief will expire as planned on December 31, 2021. The resulting uncertainty has led student loan borrowers to scramble to budget for payments, apply for income-driven repayment plans, and consider whether to request hardship deferments or forbearances if they cannot afford their regular payments. I’m an attorney focused on helping student loan borrowers. Nevertheless, the stimulus package would provide much-needed relief to millions of student loan borrowers. The extension helps address borrower concerns during the transition of the Biden administration. Notably, the current student loan relief is limited to government-held federal student loans only. Biden has indicated a willingness to enact some policy changes through aggressive executive action if necessary, but has been largely silent on his position regarding cancelling student debt via executive authority. December 15, 2020. in Loans. All Rights Reserved, This is a BETA experience. Any stimulus legislation passed by Congress would have to be signed by President Trump. You don’t have to make another federal student loan payment in 2020. A previous summary of the proposed stimulus package had suggested the extension would be to April 30. ... a continuation of the federal student loan deferral and more. Since March, millions of federal student loan borrowers have had their payments and interest suspended under the CARES Act. While certain elements of a new stimulus package are broadly popular — such as extending unemployment relief and providing additional funding to small businesses — other proposals have generated more partisan opposition. Adam S. Minsky is an advocate, innovator, and entrepreneur who established a unique law practice devoted entirely to assisting student loan borrowers and their families. Needless to say, student loan relief of any kind would be a huge help to many. VIEWS. The latest proposal would bifurcate the stimulus package. Opinions expressed by Forbes Contributors are their own. As part of a much larger Covid-19 relief package, the CARES Act froze student loan payments and interest through September 30, 2020. Citing its authority under the HEROES Act of 2003, the Department said, “Federal student loan borrowers will not be expected to make payments through January of next year, though they will continue to be able to do so and benefit from the 0% interest rate as they pay down principal. Congressional Democrats have been pushing to further extend student loan relief well into 2021 as part of larger stimulus negotiations. Background on the Student Loan Interest and Payment Suspension. Borrowers can use the extra time to prepare to start making payments again soon. It also stopped all collections efforts — such was wage garnishments and offsets of Social Security benefits — for borrowers in default on their student loans. A bipartisan group of senators has released the text of a proposed second stimulus bill, and it contains some good news for certain student loan borrowers. The student loan moratorium was originally supposed to end in September, but President Trump subsequently extended that relief to December 31. The student loan relief was originally scheduled to end in September, but the Trump administration granted two extensions — the first to December 31, and the second to January 31, to provide Congress with additional time to extend the relief further. Secretary of Education Betsy DeVos extended the federal government’s moratorium on mandatory federal student loan payments, postponing the deadline for the third time since Congress passed the first major COVID-19 relief package back in late March. That would continue to be the case if Congress passes the additional extension to April 2021. Ultimately, borrowers may be able to avoid making payments until much later in 2021, experts say. Here’s a bit of good news: President Donald Trump has extended student loan relief to December 31, 2020 by executive action . If you’re currently rehabilitating defaulted … I’m sure you are tired of the downpour of bad news that has been 2020 so far. Reading Time: 3 min 0. Now is the time, though, to decide what to do before your bill arrives in January 2021. Lawmakers have been engaged in furious negotiations to try to hammer out a bipartisan compromise stimulus package that can pass Congress before the end of the year. White House Stimulus Check Proposal Excludes Help For Student Loan Borrowers, DeVos Extends Student Loan Relief Into 2021: What You Need To Know, These Student Loans Are Not Covered By DeVos’s Extension Of Relief. President Trump suggested over the summer that his administration could further extend the moratorium through executive action, but he had not made any recent public comments to affirm this. The additional month of relief for borrowers would avert an imminent “cliff” on December 31 — a potentially disruptive gap after the current relief expires, but before President-Elect Biden is sworn in on January 20, 2021. Education Secretary Betsy DeVos has extended an existing moratorium on student loan payments, interest, and collections into 2021. If the pause is not extended, student loan borrowers will be required to resume making payments in February of 2021. Presdent-Elect Biden could further extend the student loan moratorium via executive order in the spring, although it is too soon to know whether he would do so. “The coronavirus pandemic has presented challenges for many students and borrowers, and this temporary pause in payments will help those who have been impacted," said Secretary DeVos. ... it is likely to include an extension of benefits into 2021. Under the current provisions governing the student loan moratorium, the months of suspended payments would count towards loan forgiveness programs (such as Public Service Loan Forgiveness), as well as loan rehabilitation programs for borrowers making efforts to cure defaulted federal loans.