UPDATE 1/21/2021: At the request of President Biden, the Acting Secretary of Education will extend the pause on federal student loan payments and collections and keep the interest rate at 0%.
“Too many Americans are struggling to pay for basic necessities and to provide for their families. They should not be forced to choose between paying their student loans and putting food on the table,” the Acting Secretary of Education included in the Department of Education press release.
President Joe Biden is expected to sign several executive orders this afternoon following his inauguration. Expected in these orders, Biden will extend the federal student loan administrative forbearance period, the pause in interest accrual, and the suspension of collections activity through at least September 30, 2021. Currently, there is an extension of the federal student loan administrative forbearance period through January 31, 2021.
This extension will continue the moratorium that received a number of extensions during President Donald Trump’s administration. Federal student loan borrowers to will not be expected to make payments through September, though they will continue to be able to do so if they desire and benefit from the 0% interest rate as they pay down principal.
Sources:
NASFAA: Biden to Direct ED to Extend Student Loan Relief Through September
Forbes: Expect This For Your Student Loans Tomorrow