Department of Education Considers Another Student Loan Relief Extension

U.S. department of educationAn official announcement on the department’s decision on a student loan relief extension is expected later this week.

12/22/2021 7:00 AM

3 minute read

The U.S. Department of Education and the Biden administration are reviewing extending the freeze on student loan payments past Feb. 1, Politico reports.

As COVID-19 cases increase and members of Congress have called for another delay in the student loan payments—which was said to the final extension—a Department of Education official told Politico, “Later this week, we will be announcing whether to extend the pause further.”

Department officials and the Biden administration previously said they were evaluating the effect of the omicron variant but were still planning to resume student loan payment and collections on Feb. 1, according to the article.

Members of Congress also added more pressure for delaying the student loan payments again after the Build Back Better Act did not move forward when U.S. Sen. Joe Manchin, D-W.Va., said he would vote no on the legislation.

Even before progress on the Build Back Better Act came to a halt, lawmakers began a push for Biden and the Department of Education to extend the student loan forbearance, ACA International previously reported.

Senate Majority Leader Chuck Schumer, D-N.Y., has been leading the charge for President Joe Biden to extend the pause on student loan payments since the omicron variant emerged, Forbes reports.

“With omicron spreading, the uncertainty with what happens next demands at least one more extension of the student loan payment pause,” Schumer said at a press conference, according to the article.

Another group of senators is requesting for the Biden administration to wave interest when student loan payments do resume, according to a letter from the office of U.S. Sen. Raphael Warnock, D-Ga.

Members of the House Education Committee have also requested an examination of the Department of Education’s decision to terminate its federal student loan contracts with private collection agencies, ACA previously reported.

“That unexpected action has created questions and concerns for borrowers, industry stakeholders, and Congress—particularly as student loan payment is set to begin on February 1, 2022,” U.S. Rep. Virginia Foxx, R-N.C., ranking member of the U.S. House Committee on Education and Labor, and U.S. Rep. Julia Letlow, R-La., said in a letter to U.S. Department of Education Inspector General Sandra Bruce.

ACA continues to push back on flawed policymaking decisions that unfairly target the accounts receivable management industry and will continue to educate Congress on why consumers and the economy are harmed when professional debt collectors are removed from the process.

ACA looks forward to seeing the results of the request from Foxx and Letlow and more information on the department’s decision to end the contracts and will continue to provide updates for members on this story.

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