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Student loans and August 29, 2023 [1]

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Date: 2023-06-05

So as I’m sure a lot of people are now aware, the student loan payment pause is set to formally expire on August 29, 2023. This seems like something that Biden gave up in order to get the debt ceiling deal through Congress, and I’ve heard people I know describe it as a betrayal.

But here’s the thing. The last extension of the payment pause was set to expire 60 days after June 30, 2023, or 60 days after the SCOTUS issued its ruling on Biden’s student loan forgiveness program, whichever came first. And Miguel Cardona, the Secretary of Education, confirmed in May that this would be the last extension of the payment pause, per this CNN article dated 11/22/2022. And yes, that included the end dates stated above.

So, 60 days after June 30 is August 29. In other words, Biden gave up nothing in formalizing that date aside from the scant possibility of an extension — which was already under threat of preemptively being blocked in court due to the lawsuit by SoFi and other private loan companies. If anything, by formalizing the end date in legislation passed by Congress, it both preempts the SCOTUS ruling early on the loan forgiveness program (possibly starting the countdown earlier than June 30) and the SoFi lawsuit canceling the pause early, since now the Department of Education lawyers can point to legislation that sets that end date instead of executive branch guidelines which SoFi could plausibly have argued were prone to slippage if not outright being extended again.

Even though my own loans were forgiven due to the Public Service Loan Forgiveness program, I still believe that current student loan programs are egregiously bad. So anything that helps prevent bad actors from playing games with the tens of millions of Americans who owe student loans is a win in my book.

I’m grateful to Biden for managing to hold the line here while letting McCarthy think he was getting a win on ending the payment pause.

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[1] Url: https://www.dailykos.com/stories/2023/6/5/2172966/-Student-loans-and-August-29-2023

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