This month’s announcement by the Biden-Harris administration of an extension of the pause on student loan repayment, interest, and collections through August 31, 2022, is a move that will provide much-needed relief to Floridians.
With Florida student loan portfolios totaling $98.3 billion, these extra four months will provide additional time for borrowers to plan for the resumption of payments, reducing the risk of delinquency and defaults after restart.
During the extension, the U.S. Department of Education will continue to assess the financial impacts of the pandemic on student loan borrowers and to prepare to transition borrowers smoothly back into repayment.
This includes allowing all borrowers with paused loans to receive a “fresh start” on repayment by eliminating the impact of delinquency and default and allowing them to reenter repayment in good standing. The Department will also continue to provide loan relief, including to borrowers who have been defrauded by their institutions and those eligible for relief through the Public Service Loan Forgiveness program.
“The Department of Education is committed to ensuring that student loan borrowers have a smooth transition back to repayment,” said U.S. Secretary of Education Miguel Cardona.
“This additional extension will allow borrowers to gain more financial security as the economy continues to improve and as the nation continues to recover from the COVID-19 pandemic. It remains a top priority for the Biden-Harris Administration to support students, families, and borrowers – especially those disproportionately impacted by the pandemic. During the pause, we will continue our preparations to give borrowers a fresh start and to ensure that all borrowers have access to repayment plans that meet their financial situations and needs.”
In just over one year, the Department has provided over $17 billion in targeted loan relief to over 700,000 borrowers.
According to educationdata.org, the national student loan debt in 2022 stands at over $1.611 trillion and 43.4 million borrowers have federal student loan debt. The average federal student loan debt balance is $37,113.
In Florida, the total outstanding debt is approximately $98.3 billion by 2.6 million borrowers. The average student loan balance in the state is $35,496 and the average total monthly payment is $280.
The Department of Education says Federal Student Aid (FSA) will establish new partnerships to ensure that borrowers working in public service are automatically credited with progress toward forgiveness, eliminating paperwork that prevents many borrowers from getting help.
“FSA will also continue to transfer loans to servicers committed to working under new, stronger accountability rules,” they said.
