President Joe Biden has announced another extension of coronavirus emergency relief benefits for borrowers with federal student loans through August 31, 2022.
The original coronavirus relief bill, known as the CARES Act and signed into law on March 27, 2020, helped most federal student loan borrowers by temporarily pausing payments and involuntary collections on federally held student loans through September 30, 2020.
Since that date, there have been additional extensions and with the most recent announcement, most borrowers with student loans held by the federal government will not be required to make payments on those loans nor have interest accrue on them. In addition, collections activities such as wage garnishment and the reduction of tax refunds have been prohibited.
The Biden Administration also plans to provide a “fresh start” on repayments to all borrowers with paused loans by “eliminating the impact of delinquency and default and allowing them to reenter repayment in good standing,” according to a press release posted online by the U.S. Department of Education.
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