Warren, Schumer, Pressley, Courtney Lead Call On Biden to Extend Pause on Student Loan Payments
Washington, DC - United States Senator Elizabeth Warren (D-Mass.), Majority Leader Chuck Schumer (D-N.Y.), Representative Ayanna Pressley (D-Mass.), and Representative Joe Courtney (D-Conn.) led their colleagues in a bicameral letter to President Biden calling on him to extend the pause on federal student loan payments until at least March 31, 2022.
"President Biden should cancel student debt, but in the meantime he should extend the payment pause so that borrowers aren't hurt," said Senator Warren.
"President Biden should act quickly to pause payments and interest for federally-held student loans as our country continues to recover from the historic COVID-19 health and economic crisis," said Majority Leader Schumer. "Failing to extend this pause would not only hurt our nation's struggling students, but it could also impact future economic growth and recovery."
"President Biden can and must cancel student debt with the stroke of a pen. We urgently call on him to act," said Rep. Pressley. "In the interim, extending this payment pause will provide a crucial additional layer of relief for millions of borrowers. We can't turn our backs on these families as we work toward an equitable economic recovery."
During the coronavirus pandemic, executive actions by former Education Department (ED) Secretary Betsy DeVos and the passage of the Coronavirus Aid, Relief and Economic Security (CARES) Act paused payments for millions of borrowers. Recognizing the significant burden that student debt places on borrowers during an economic crisis, President Biden extended this pause through September 30, 2021, for the 87% of borrowers with direct federal loans. During this pause, ED has provided approximately $72 billion in relief on student loan interest alone - money that has been reinvested into the economy. Borrowers have reported being able to pay down other debt, relieve financial pressures from lost jobs or decreased earnings, and support their families.
However, student loan payments are currently scheduled to resume on October 1, 2021. This could create an unnecessary drag on the economic recovery, especially with unemployment benefits also set to expire in September. Following past emergency suspensions of student loans during natural disasters, increased numbers of borrowers became delinquent or defaulted on their loans.
"The scheduled resumption of student loan payments in October could create a significant drag on our economic recovery. Before the pandemic, the average student loan payment was between $200 and $299 per month - a substantial part of a household budget, and money that is desperately needed for basic needs," the lawmakers wrote.
Extending the pause on payments would provide ongoing relief for student loan borrowers, who are disproportionately women and people of color, the same groups that have been more adversely affected by the pandemic. It would also give ED more time to prepare for payments to resume.
"We urge you to act quickly to extend the current pause on payments and interest so that borrowers are not penalized and student debt payments do not drag down the pace of our economic recovery. Specifically, we ask that you extend the pause by at least six months-until March 31, 2022-or until the economy reaches pre-pandemic employment levels, whichever is longer," the lawmakers concluded.
The letter is signed by Senators Edward J. Markey (D-Mass.), Sherrod Brown (D-Ohio), Ron Wyden (D-Ore.), Robert Menendez (D-N.J.), Richard J. Durbin (D-Ill.), Bernie Sanders (I-Vt.), Cory Booker (D-N.J.), Chris Van Hollen (D-Md.), Alex Padilla (D-Calif), Mazie Hirono (D-Hawaii), Jeff Merkley (D-Ore.), Tina Smith (D-Minn.), Tammy Duckworth (D-Ill.), Richard Blumenthal (D-Conn.), Sheldon Whitehouse (D-R.I.), Brain Schatz (D-Hawaii), Jack Reed (D-R.I), Patrick Leahy (D-Vt.) , Kyrsten Sinema (D-Ariz.) and Representatives Brendan Boyle (PA-02), Jimmy Panetta (CA-20), Jamie Raskin (MD-08), Hank Johnson (GA-04), Gwen Moore (WI-04), Jahana Hayes (CT-05), Jesus "Chuy" Garcia (IL-04), Alma Adams (NC-12), Katie Porter (CA-45), Mondaire Jones (NY-17), Mark Takano (CA-41), Bobby L. Rush (IL-01), Eleanor Holmes Norton (DC), Barbara Lee (CA-13), Earl Blumenauer (OR-03), Mike Doyle (PA-18), David N. Cicilline (RI-01), Bennie Thompson (MS-02), Gerald E. Connolly (VA-11), Dwight Evans (PA-03), Jared Huffman (CA-02), James P. McGovern (MA-02), Mark Pocan (IN-07), Tony Cárdenas (CA-29), Andre Carson (IN-07), Suzanne Bonamici (OR-01), Albio Sires (NJ-08), Jerry McNerney (CA-09), Ruben Gallego (AZ-07), Pramila Jayapal (WA-07), Ilhan Omar (MN-05), Alan Lowenthal (CA-47), John B. Larson (CT-01), Jim Himes (CT-04), Raul Grijalva (AZ-03), Rosa L. DeLauro (CT-03), Peter DeFazio (OR-04), Mary Gay Scanlon (PA-05), Ritchie Torres (NY-15) and Joaquin Castro (TX-20).
Senator Warren is one of the nation's leading voices calling for student debt cancellation to boost our economy, help close the racial wealth gap for borrowers, and put an end to predatory practices that harm and trap borrowers in years of debt.
- Earlier this week, Senator Warren led her colleagues in sending a letter to the CEOs of all federal student loan servicers requesting information about the steps the companies are taking to transition millions of federal student loan borrowers back into repayments once the pause on student loan payments and interest ends in October 2021.
- In May, Senator Warren led her colleagues in sending a letter to Secretary of Education Miguel Cardona requesting updates on ED's actions to protect students during the pandemic.
- In May, Senator Warren led her colleagues in sending a letter requesting information about the steps ED and the Office of Federal Student Aid (FSA) are taking to help transition millions of federal student loan borrowers back into repayment ahead of the scheduled end for paused student loan payments and interest in September.
- In April 2020, Senators Warren and Raphael Warnock (D-Ga.) led a group of colleagues in a letter to Education Secretary Miguel Cardona urging the Department of Education to take swift action to automatically remove all federally-held student loan borrowers from default.
- That same month at her first hearing as chair of the Senate Banking, Housing, and Urban Affairs Committee's Subcommittee on Economic Policy, Senator Warren called out giant student loan servicer Pennsylvania Higher Education Assistance Agency for its mismanagement of the Public Student Loan Forgiveness Program.
- Senator Warren also questioned Jack Remondi, CEO of one of the nation's largest student loan servicers, Navient, on the company's long history of abusive and misleading behavior towards borrowers and how the company has made millions of dollars by profiting off the broken student loan system.
- Senator Warren has also been continuing her calls for President Biden to use his existing authority to cancel $50,000 in student debt and highlighted data that she obtained from the Education Department revealing the benefit of student debt cancellation.
- In March 2021, Senators Warren and Bob Menendez (D-N.J.) applauded the passage of their Student Loan Tax Relief Act as part of the American Rescue Plan. The provision makes any student loan forgiveness tax-free, ensuring borrowers whose debt is fully or partially forgiven are not saddled with thousands of dollars in surprise taxes. During her time in the Senate, she has helped return tens of millions of dollars tax-free to students cheated by for-profit colleges.
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