Tens of millions of Americans with federal student loan debt have had a financial reprieve for more than three years as a pandemic-era repayment pause was extended multiple times since March 2020.
Now many face a new reality on Sunday, Oct. 1, when they are due to resume making payments, all while struggling with nagging inflation and rising interest rates.
More than 45 million borrowers together owe approximately $1.6 trillion, according to President Joe Biden’s administration, which tried to cancel up to $20,000 in student debt for tens of millions of eligible borrowers, only to have the Supreme Court kill the program in June.
I mean…I still owe $8K and I spent the last three years paying directly to the principal as well. That said, I still hate this. Rather than being able to pay off in another year or so, it’s going to be closer to five years.
There’s options available. Like, how about a “step up” rather than just reopening the floodgates? Turn on the repayments, but not the interest. How about keep the interest off the last $20K if you’re not in the rears? Allow people to get a chance to make progress on their debts, or at least give an incentive on keeping the payments current.
A direct return to the status quo doesn’t get lenders their money in a time of rising rates, and it definitely doesn’t help those in debt nor the overall economy.
“Allow people to get a chance”
They had 3 years… before that it was expected that they would make payments. Are you under the impression that everyone took out these loans thinking that they would never have to pay them back?