President-elect Joe Biden’s administration plans to maintain a hiatus on federal student loan payments when he takes office this month, according to officials helping with the transition.
The tens of millions of student loan borrowers across the country could continue to withhold payments, although it is not immediately clear how long the hiatus would last.
Biden officials also said on Friday they would encourage Congress to pass legislation to write off $ 10,000 in federal student loan debt per person. The move, however, is likely to draw criticism from activists who pushed Biden to write off more debt per person, in some cases up to $ 50,000, via executive action upon taking up the post.
At the start of the coronavirus pandemic, President Donald Trump’s administration suspended student loan payments, froze interest, and asked loan officers to stop their collection efforts. This the break was recently extended by outgoing Education Secretary Betsy DeVos until the end of January.
“On day one, the president-elect will call on the Department of Education to extend the existing pause on student loan payments and interest for millions of Americans on federal student loans,” said David Kamin, the new director deputy of the National Economic Council and recently a professor in the law school of New York University.
More controversial is the forgiveness of federal student loan debt. Critics of the student loan cancellation, who include both Liberals and Conservatives, have said wiping off those debts would be unfairly benefit those with a college education, who usually earn more as a result.
According to Federal Reserve data, Americans hold about $ 1.7 trillion in student loan debt. Student borrowers graduating in 2019 from public or private non-profit colleges held an average of $ 28,950 indebted, according to the Institute for College Access and Success.