The pause in payments affects over 36 million borrowers, who collectively hold over $1.3 trillion in student loan debt.
“If loan payments were to resume on schedule in May, analysis of recent data from the Federal Reserve suggests that millions of student loan borrowers would face significant economic hardship, and delinquencies and defaults could threaten Americans’ financial stability,” the president said in a statement.
“Accordingly, to enable Americans to continue to get back on their feet after two of the hardest years this nation has ever faced, my Administration is extending the pause on federal student loan repayments through August 31st, 2022.”
The pause on federal student loan payments was first implemented by the Trump administration in the early days of the COVID-19 pandemic. The pause has since been extended multiple times, most recently in December 2021.
The president also called on borrowers to prepare to resume repayments by working with the Department of Education to “prepare for a return to repayment” and “look into Public Service Loan Forgiveness, and explore other options to lower their payments.”
Education Secretary Miguel Cardona touted the extension of the pause, saying it would “allow borrowers to gain more financial security as the economy continues to improve and as the nation continues to recover from the COVID-19 pandemic.”
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