WASHINGTON (AP) – The Biden administration on Wednesday extended a student loan moratorium that has allowed tens of millions of Americans to put off debt payments during the pandemic.
Under the action, payments on federal student loans will remain paused through May 1. Interest rates will remain at 0% during that period, and debt collection efforts will be suspended. Those measures have been in place since early in the pandemic, but were set to expire Jan. 31.
President Joe Biden said financial recovery from the pandemic will take longer than job recovery, especially for those with student loans.
“We know that millions of student loan borrowers are still coping with the impacts of the pandemic and need some more time before resuming payments,” he said in a statement, adding it was an issue he and the vice president “both care deeply about.”
The omicron variant of COVID-19 that has swept through the U.S. with a fury has lent a new urgency to the question over whether the moratorium would be extended. Administration officials had initially said they expected the January extension to be the last. But even as the economy improves, there are concerns that borrowers are not ready to start payments again. Once the moratorium ends, those who were already behind on payments could have wages and benefits taken away as part of debt collection efforts.