Student loans removed from the new stimulus program?
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Did Congress Remove Student Loans From The New Stimulus Package?
Here’s what you need to know.
Congress is about to finalize a new stimulus plan with second dunning check $ 600 for each person and child as well as $ 300 per week for unemployment insurance. For millions of Americans, this is the good news. (That said, most Americans wonder why they didn’t get a second stimulus check). However, one thing was notoriously absent from a joint statement today from House Speaker Nancy Pelosi (D-CA) and Senate Minority Leader Chuck Schumer (D-NY): student loans. Pelosi and Schumer issued a joint statement with the main highlights of the new stimulus package, which Congress has not finalized. Pelosi and Schumer made no reference to any extension of student loan relief. If student loans are excluded of the latest stimulus bill, here’s what that could mean for your student loans.
Student loan relief expires January 31, 2021
In an unexpected move earlier this month, President Donald Trump suspended federal student loan payments for one more month until January 31, 2021. That means the existing student loan relief from the stimulus package. the Cares Act will not expire on December 31, 2020 as planned. Previously, Trump extended student loan relief from September 30 to December 31. Therefore, student loan borrowers can continue to expect the following on their federal student loans until January 31, 2021:
- No payment: federal student loan payments are suspended.
- Of no interest: no new interest will accrue on your federal student loan balance.
- No debt collection: Collection of delinquent student loans is halted.
Private student loans, FFELP loans, and Perkins loans are not eligible for the payment break or other student loan relief. Until January 31, 2021, student loan borrowers can still pay off their federal student loans if they choose. Two weeks ago, a new stimulus package would have extended student loan relief until April 30, 2021. Other Democrats have proposed to suspend payments on federal student loans at least until September 30, 2021 or the end of the Covid-19 pandemic. However, this later date gained less ground on a bipartisan basis in Congress. If student loans are no longer suspended, make sure you do these 7 things.
The incentive package does not include the cancellation of the student loan
As expected, the new stimulus package does not include any student loan discounts. With Republicans in charge of the US Senate, everything considering canceling student loans were not meant to be included. Democrats will have to wait until the next term in Congress or after President-elect Joe Biden becomes president. Democrats in Congress have proposed several plans to cancel student loans, including the most recent effort to cancel up to $ 50,000 in student loans by presidential decree. For supporters of large-scale student loan cancellation, canceling student loans would be the best hope given the balance of power in Congress and the White House.
New Stimulus Package: Biggest Pell Grants Expansion Ever
According to the joint statement, the new stimulus package will include “the biggest expansion of Pell grant recipients in more than a decade.” Pelosi and Schumer say the Pell Grants will impact 500,000 new grantees and “ensure that over 1.5 million students will now receive the maximum benefits.” Separately, the stimulus package could provide $ 82 billion to colleges and schools.
Pay off student loans
Will you get more relief for your student loans? Congress could extend student loan relief beyond Jan.31, 2021 through separate legislation, or wait for the next terms of Congress and the presidency. Otherwise, expect this student loan relief to expire on January 31, 2021. In the meantime, make sure you have a student loan repayment game plan. Here are 3 ways to pay off student loans, all at no cost: