US students are likely to face difficulties as the pause on student loan repayments since March 2020 will be ending soon. A New York Federal Reserve analysis shows there will be a significant rise in the delinquency rate, as students would suffer to pay their debts for loans from May 2022.
The Fed analysis also reported that around 10 million borrowers who were not granted the student loan relief, had to pay their debts during the pandemic—seeing a rise in delinquency rates.
This conclusion of the forbearance is set to impact over 37 million borrowers throughout the country.
Will Biden save the students with another extension?
Students get a ray of hope as President Joe Biden’s administration is hinting at the possibility of extending the loan repayment pause once again—making this the sixth extension since the pandemic if accepted.
While Democrats support the extension on freezing the payments on student loans, the Republicans oppose the suggestion and urge to end the forbearance.
Over $195 billion worth of payments have been waived, helping federal student loan borrowers save their money during the pandemic.
