BREAKING: President Biden Extends Student Loan Payment Pause

Both the pause on payments and interest waiver is automatic, but only applies to federally held loans. That covers roughly 85% of all federal student loans, including those known as direct federal loans and PLUS loans that parents have taken out on behalf of their children. It excludes some federal loans that are guaranteed by the government but not technically held by it. Generally, those were disbursed prior to 2010.

The move comes after key Democratic lawmakers have put pressure on Biden to extend the relief. Senate Majority Leader Chuck Schumer of New York and Sen. Elizabeth Warren of Massachusetts led a group of more than 60 other Democrats in asking the President in a letter sent in June to push back the restart date, warning it could “create a significant drag on our economic recovery.”

Schumer and Warren have also led the charge in pressuring Biden to go even further, urged him to cancel $50,000 in student debt per borrower.

Biden, who said during the presidential campaign that he would support canceling $10,000 per borrower, has repeatedly resisted the pressure since taking office, arguing that the government shouldn’t forgive debt for people who went to “Harvard and Yale and Penn.”

As of now, he has directed Cardona, his education secretary, to write a memo on the executive branch’s legal authorities to cancel debt. It would be an unprecedented move, but a memo from lawyers at Harvard’s Legal Services Center and its Project on Predatory Student Lending says the Department of Education has the power to do so.

Since taking office, Biden has canceled about $1.5 billion in debt for borrowers who were defrauded by their for-profit colleges. The forgiveness process for those borrowers has been in place for years, but cancellations came to a halt during the Trump administration under then-Education Secretary Betsy DeVos, who attempted to change the rule.