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The Student Loan Payment Mess Is About to Get Worse

It’s been a bumpy ride for student loan borrowers over the last five years. The first Trump administration paused federal student loan payments in 2020 when the pandemic arrived and shocked the world economy. After the 2020 election, President Joe Biden repeatedly extended the pause, but borrowers received a series of conflicting messages as officials repeatedly warned repayment was about to resume, only for the pause to extend again.  

Biden simultaneously pledged that broad debt cancellation was imminent. His administration secured more than $180 billion in student loan forgiveness, but the more expansive plans for debt cancellation relied on shaky executive authority, and legal challenges quickly stymied the efforts. 

The pauses effectively ended last October—repayment technically resumed in October 2023, but Biden waived collection enforcement for 12 more months—and in April, the Trump administration announced that debt collection for borrowers in default would resume on May 5. The music has finally stopped for the loan leeway, but after years of mixed signals, payment plan changes, and legal limbo, many borrowers aren’t looking for their chairs. Millions of borrowers are already in default and millions more are now in late-stage delinquency, meaning a wave of new defaults could hit as soon as next month. 

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