One of the last holdouts from the pandemic era is about to end. Student loans were put on hold for more than three years and interest rates were reduced to 0%. As part of the debt ceiling agreement signed by President Joe Biden in June 2023, student loan payments will resume at the end of August. According to the U.S. Department of Education, “student loan interest will resume starting on Sept. 1, 2023, and payments will be due starting in October” (Federal Student Aid). This is separate from President Biden’s student loan forgiveness which is on hold pending a decision from the U.S. Supreme Court later this month.
A brief history of the federal student loan pause during the pandemic era is as follows: On March 13, 2020 President Trump announced that interest would be eliminated on all federal student loans. The following week, the US Department of Education announced student loan interest would be suspended for three months and payments suspended for two months. On March 27, 2020 President Trump signed the CARES Act (Coronavirus Aid, Relief, and Economic Security) suspending federal student loans through September 30, 2020.
President Trump extended the payment pause two more times during his last year in office. When President Biden took office in January 2021, he extended the pause several times; the last pause was announced on April 6, 2022 which extended student loan relief measures through August 31 that year (Custer, Bradley D and Azoulay, Ella). Visit here for more details on the student payment pause timeline.
Below is a CNBC segment from 2020 where President Trump announces executive action that pauses interest on all federal student loans until further notice.
When the U.S. Supreme Court took up the student loan forgiveness case, President Biden extended the pause until 60 days after the Court made its decision or June 30, 2023, whichever comes first.
Now that the pause on student loans is ending this summer, it’s time to start thinking about how you will pay them. ABCNews published an article on June 16, 2023 offering some tips:
First, locate your student loan servicer, since the company that manages your student loans may have changed over the past three years. You can find your loan servicer by logging on to studentaid.gov.
Next, make sure your loan servicer has accurate and up-to-date contact information. Repayment start dates will differ depending on who manages your loan, so be sure to ask when payments will resume and how much you’ll owe each month, once they do…
Christoforous
Several federal plans base your payments on your income and family size. Income-driven repayment plans, such as Pay As You Earn and Revised Pay As You Earn, can make your payments more manageable and, in some cases, could push your payment as low as $0 per month. If you can’t keep up with payments, ask your lender about a deferment or forbearance period.
Social Media Trends as of June 17, 2023
Facebook #studentloanpause: people are posting about this
Instagram #studentloanpause: 204 posts
TikTok #studentloanpause: 3,300,000 views
YouTube #studentloanpause: 100 videos and channels
Google Trends: “student loan pause” first appeared in January 2021 despite executive action pausing interest and payment of student loans in March 2020. There are many different ways of phrasing “student loan pause” but this is the one I used for this blog. The popularity of the phrase spiked in December 2021, April 2022 and peaked in August 2022. There is every reason to believe it will peak this summer as 45 million students will have to make room in their budget for student loan payments.
Sources:
Christoforous, Alexis. The student loan challenge: Here’s what to do when payments resume.” ABCNews. June 16, 2023. URL: https://abcnews.go.com/US/student-loan-challenge-payments-resume/story?id=100146106.
CNBC Television. “President Donald Trump waives interest on all student loans due to coronavirus.” YouTube. 2020. URL: https://www.youtube.com/watch?v=7Alu8UcRkiE.
Custer, Bradley D and Azoulay, Ella. “Timeline: Federal Student Loans During the COVID-19 Pandemic.” American Progress.org. Aug 9, 2022. URL: https://www.americanprogress.org/article/timeline-federal-student-loans-during-the-covid-19-pandemic/.
Federal Student Aid. U.S. Department of Education. 2023. URL: https://studentaid.gov/.
@POTUS. Student loan forgiveness and payment pause. Twitter. Nov 22, 2022. URL: https://twitter.com/POTUS/status/1595150070285885440.
Student loan meme. ImgFlip. URL: https://www.weareteachers.com/wp-content/uploads/never-repay.jpeg.
