Borrowers Expected To Get Update Soon As Nationwide Pause On Student Loan Debt Slated To Expire

As part of comments issued this past Sunday, Education Secretary Miguel Cardona explained that the Biden administration would be coming forth with a proper announcement within the next ten days as to whether or not the current nationwide pause surrounding student loan payments and interest accrual that went live over two and half years ago will be extended yet again or officially fall off.

While speaking on a segment of NBC’s “Meet the Press,” Cardona stated to host Chuck Todd that the administration knows “many people are waiting to hear something” regarding the deadlines currently set at Aug. 31st about the current moratorium, which started out under the Trump administration at the start of the COVID-19 pandemic and has since been issued extensions quite a few different times.

“We’ve been talking daily about this, and I can tell you the American people will hear within the next week or so,” stated Cardona.

Cardona stated that the administration had already forgiven well over $10 billion in student debt to roughly 1.6 million borrowers as part of the Public Service Loan Forgiveness program, which included government organizations at any level.

“Public Service Loan Forgiveness was broken,” he claimed. “We fixed it so that our teachers or nurses can get loan forgiveness right away.”

Cardona explained that the administration has been heavily focused on making sure it would protect borrowers and students from the start. Since making the choice to extend the previous administration’s pause, the Biden administration has issued forgiveness to about $32 billion in various student loans, most of whom went to schools that have since gone bankrupt or even faced litigation concerning the misleading of students and outright fraudulently conducting business.

Just last week, the U.S. Department of Education stated that it would cancel roughly $4 billion in the remaining 208,000 federal student loans for borrowers who attended ITT Technical Institute from 2005 until the college chain, which was for profit, was officially dissolved back in 2016. Officials also issued a formal notice to DeVry University to pay back $24 million of approved borrower defense claims.

One Forbes Advisor reported that just about 92% of federal loans make up the largest majority of American education debt, equaling to $1.6 trillion owed by a total of 43 million borrowers.

Biden put forth the idea that he was talking about forgiving roughly $10,000 of the student loan debt for most people earlier this year. With the freeze still set up, the administration has been dealing with increased pressure from various advocates for student loan forgiveness and for Democrats to take steps to cancel up to $50,000 in debt per person.

However, the canceling of federal student loans for the multiple million Americans being crushed under the weight of the debt would end up costing the federal government multiple hundreds of billions of dollars, and the general public would eventually deal with the results of such a decision.

The Committee for a Responsible Federal Budget issued a report stating that the canceling of around $50,000 of debt per borrower would cost around $950 billion, and canceling up to $10,000 would cost roughly $245 billion.


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