President Joe Biden is expected to extend the pause on student loan payments through August 31, according to a federal official who confirmed details to Bloomberg on Tuesday (April 5).
The extension comes weeks before the payments were due to start back up on May 1 after the original pandemic-related moratorium was put in place back in 2020 and extended several times since. The move will impact 43 American borrowers who owe a collective $1.6 trillion in federal student loan debt, and includes the 7 million borrowers who've defaulted on their loans, or are more than 270 days late in making payments.
When the August 31 date comes around, the interest rate will sit at 0%, multiple outlets reported.
Last week, Democrats called on the Biden Administration to cancel student loan altogether –– something many have been calling for years. Additionally, the move would help bolster what's predicted to be a contentious midterm election season later this year.
"It is ruining lives and holding people back," Sen. Patty Murray said in a statement last month. "Borrowers are struggling with rising costs, struggling to get their feet back under them after public health and economic crises, and struggling with a broke student loan system –– and all this is felt especially hard by borrowers of color."
One analysis found that if student loans were canceled, Black wealth in the US would increase by 40% overall. Another study found that compared to white women, Black women shoulder 22% more in student debt on average.
Paired with pay inequality, higher rates of unemployment and employment discrimination, student loan relief directly effects Black America.
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