Almost three years and eight extensions later, the pandemic-relief policy suspending federal student loan payments is still in issue.
The Supreme Court’s hearings on President Joe Biden’s student loan forgiveness plan on February 28 are expected to confirm the timeline. In short, depending on the outcome, borrowers may have slightly longer than two more months or as much as six months to pay.
The length of time it takes the Supreme Court justices to rule on the president’s plan will determine when student loan payments resume. Repayment could resume in May or June if the court rules shortly after the hearing on February 28. However, if they wait until the term is over in June or July, repayment would resume in August or September.
The Education Department announced that it is also stopping all collection efforts during the prolonged payment pause, including the garnishment of wages and tax refunds.
According to an article published by CNBC on February 21, 2023, a number of conservative organizations and states with Republican support challenged the policy in court soon after Biden unveiled his comprehensive plan to wipe out up to $20,000 in student debt for millions of Americans.
Two of these lawsuits have been successful in stopping the relief, at least momentarily, and the Supreme Court has agreed to hear oral arguments for them.
The high court justices ought to end the confusion involving loan forgiveness.