Biden extends student loan payment moratorium to May 2022

The White House announced Wednesday President Joe Biden is extending the nation’s student loan payment moratorium by 90 days. The video above shows White House Press Secretary Jen Psaki making the announcement at her daily briefing. The moratorium was set to expire on Jan. 31. It’s now expected to end on May 1.

During this time, interest rates will remain at 0% and debt collection efforts will be suspended. Administration officials had initially said they expected the January extension to be the last, due in part to a reduction in weekly unemployment claims to pre-pandemic levels. However, President Biden said financial recovery from the pandemic will take longer than job recovery has.

“We know that millions of student loan borrowers are still coping with the impacts of the pandemic and need some more time before resuming payments,” Biden said in a White House statement. “The Department of Education will continue working with borrowers to ensure they have the support they need to transition smoothly back into repayment and advance economic stability for their own households and for our nation.”

That financial recovery is not just from the pandemic, but from rising inflation that has persisted as the economy began to recover from the pandemic. Consumer prices increased at a rate not seen since 1982 last month. Borrowers are now also having to navigate the new Omicron variant of COVID-19. In a Department of Education news release, Education Secretary Miguel Cardona said extending the student loan payment moratorium “will allow our Administration to assess the impacts of Omicron on student borrowers.” According to the release, the moratorium will also “help 41 million borrowers save $5 billion per month.”

The extension of the student loan payment moratorium comes as the decision of whether to erase large chunks of student debt altogether is still on the table. Some Democrats are pushing for mass forgiveness. However, Biden has questioned whether he has the authority to make that happen. He has previously said he supports canceling up to $10,000 in student debt, but he has said that should be done by Congress.