Social Security

“Borrowers are not aware of what all their rights are. The student loan system is complicated,” says Persis Yu, policy director at the Student Borrower Protection Center. “I think we need to see a remedy to acknowledge the fact that there has been a longstanding problem of borrowers getting steered into forbearance and deferments.”

While consumer groups and activists have applauded the payment pause’s extension, they remain focused on pushing for more. Biden repeatedly said canceling at least $10,000 in education debt would be part of his economic recovery plan after his election, but he didn’t include any such policy in this year’s sweeping rescue package or domestic spending bill, signaling to liberal groups that the issue was not a priority.

What happens when loan repayment restarts an open question. From an administrative perspective, it could get messy. Before the pandemic — and when the economy was ostensibly in a stronger position — people were already struggling to pay. During the 2019 federal fiscal year, which runs from October 1 to September 30, over 1.2 million student borrowers defaulted on their loans. That means one borrower defaulted on a federal loan every 26 seconds. According to…