Biden may extend student loan payment pause, but these Republicans want to end student loan relief now
President Joe Biden could extend student loan payment break, But these Republicans want to end student loan relief now.
Here’s what you need to know — and what it means for your student loans.
The prospect of a fourth extension of the student loan payment pause has student borrowers excited. Yes, Biden can extend the student loan payment break again. Since Biden became president, no student loan borrower has been required to make federal student loan payments. However, if Congress passes new legislation, this could be the last extension of the student loan payment break.
(Biden could extend student loan payment break indefinitely)
Republicans seek to end student loan payment pause
Last week, Rep. Jim Banks (R-IN) and Rep. Bob Good (R-VA) introduced new legislation — the Federal Student Loan Integrity Act — aimed at limiting the ability of the U.S. Secretary of Education to continue suspend student loan repayments. The student loan payment pause is scheduled to end on May 1, 2022. These Republicans want to ensure that May 1 is the final expiration of the federal student loan payment pause, which has been going on since March 2020. Since then, the Congress passed historic student loan relief, which imposed a moratorium on federal student loan repayments, suspended interest accrual on federal student loans, and halted collection of all defaulted federal student loans. Banks and Good say this student loan relief is the largest in the history of the federal student loan program. “Republicans need to use their watchdog power to make sure this administration stops using COVID as an endless excuse to expand its power, waste taxpayers’ money, and fuel further inflation,” Banks said. Policy.
(Explosive Report Claims This Student Loan Service Deceived Student Loan Borrowers)
Student loan relief: How this legislation could end the student loan payment pause
Specifically, Banks and Good want their bill to:
- clarify the intent of Congress with respect to the powers granted to the Secretary of Education under the Higher Education Student Aid Opportunities Act of 2003 (the “Heroes Act”); and
- prevent further abuse of the Education Secretary’s authority under the Heroes Act amid the national Covid-19 emergency.
President Donald Trump has relied on the Heroes Act to extend the student loan payment break twice during his presidency. Biden relied on the same authority to extend that same student loan relief three times. The Heroes Act 2003 allows the Education Secretary to waive or vary any requirement of the Higher Education Act 1965 during a national emergency to ensure that student borrowers are not in a situation worse than before the pandemic.
However, the bill notes that Congress has only authorized six months of student loan relief – from March 2020 to September 2020. However, Congress has not authorized any other student loan relief under the law. Heroes Act of 2003. According to the bill, “The Secretary undermined the intent of Congress and abused its authority under the Heroes Act to alter statutory provisions of the Higher Education Act. The President and Education Secretary do not believe they have overstepped their bounds and are instead acting within the law amid the national Covid-19 emergency.Together, Trump and Biden have granted five extensions to the payment break of the student loan and Biden is considering an unprecedented sixth extension.
(Biden to Forgive $6.2 Billion in Student Loans)
What it means for student loan forgiveness
This bill could limit the president’s ability to enact large-scale student loan forgiveness. (Cancellation of a student loan does not mean what you think it means). While the president relied on the Heroes Act to extend the student loan payment pause (not student loan forgiveness), Republican lawmakers are raising an important question about the separation of powers. They argue that the executive branch (the US Secretary of Education) exceeded its authority under the law and undermined the intent of Congress. Republicans could make a similar argument about large-scale student loan cancellation, if Biden seeks to enact mass student loan cancellation. Sen. Elizabeth Warren (D-MA) argues that the Higher Education Act of 1965 also empowers the president to forgive student loans. However, Republicans can argue that Congress never intended to completely transfer its power and authority from the legislative branch (the Congress) to the executive branch (the president). (Biden could cancel the student loan and suspend student loan payments this year). Republicans will likely argue that while Congress appropriated federal student loans, Congress did not authorize the cancellation of those student loans. Without congressional ownership, Republicans can argue that the executive branch is powerless to enact large-scale student loan forgiveness.
Even with this bill, the suspension of student loan payments is scheduled to end on May 1, 2022. If Congress passes this legislation before then (which could be an uphill battle), Biden could be limited if he tries to extend the student loan payment. pause. That said, there is no guarantee that Biden will extend student loan relief. Therefore, student borrowers should prepare for the restart of student loan repayments.
Focus on these ways to save money and pay off your student loans faster: