“The extension of the payment pauses provides much needed relief to borrowers during the pandemic in the short-term,” says Sarah Sattelmeyer, director of the Pew Charitable Trust’s Student Borrower Success project. The big question now is what happens next.
Many hope that temporary pandemic relief for borrowers will open the door to more permanent loan forgiveness. But it’s unclear to what extent the Biden administration would do that. On Jan. 8, David Kamin, the incoming deputy director of Biden’s National Economic Council, repeated Biden’s support of Congress canceling up to $10,000 in federal student loans per borrower in response to the pandemic. But many Democrats want him to go further.
In September, Democratic Sens. Elizabeth Warren and Chuck Schumer unveiled a plan calling for the next president to cancel up to $50,000 of outstanding federal student loans per borrower. Biden has yet to signal interest in this plan. In his campaign proposal, he outlined a number of changes to paying back loans, including canceling $10,000 in debt for students who work in national or community service.