The Biden administration is planning to extend its moratorium on student debt repayments once again. According to an administration official cited by Politico, the relief program, which paused payments and interest accrual for borrowers with federal student loans at the onset of the pandemic in March 2020, will be extended through the end of August. Following a 90-day extension announced after the emergence of the Omicron variant in December 2021, the moratorium was scheduled to expire on May 1.
Just last week, almost 100 Democratic lawmakers had sent a letter to President Biden, urging him to extend the payment pause until at least the end of 2022, while also calling for meaningful student debt cancellation. "Given the fast-approaching deadline for borrowers to resume payments, your administration must act as quickly as possible to extend the pause and make clear to the American public your intention to cancel a meaningful amount of student debt," the letter reads. "Canceling student debt is one of the most powerful ways to address racial and economic equity issues," the lawmakers led by Sen. Elizabeth Warren (D-Mass.) and Majority Leader Chuck Schumer argued.
According to the Federal Reserve, the level of outstanding student debt in the United States reached $1.75 trillion by the end of 2021. As the following chart shows, the student debt burden has more than tripled over the past 15 years, which is one of the reasons for the calls for student debt relief to grow louder and more frequent. Student loans are the second largest category of household debt in the U.S., trailing housing debt by a wide margin. Auto loans are the third largest category, currently standing at $1.3 trillion.