MYNORTHWEST NEWS

‘There’s so much more to do,’ says Sen. Murray of decision to extend student loan moratorium

Apr 6, 2022, 10:47 AM

student loan...

Patty Murray (D-WA) (Getty Images)

(Getty Images)

The Biden administration has extended a pause on student loan repayments through Aug. 31, leveraging a moratorium that has halted repayments for student borrowers since the start of the pandemic.

White House to extend student loan pause through August

Student loan payments were previously scheduled to resume at the start of May.

Washington Senator Patty Murray has been a vocal critic of the student loan system in recent weeks and months. Following the Biden Administration’s announcement, the senator said that, while the pause is “urgently needed” … “we need long-lasting change and a student loan system that actually works for students and borrowers—not just quick fixes.”

“I’ve outlined a clear plan the Administration must follow and I’m glad to see they intend to act to give struggling borrowers a fresh start,” Sen. Murray continued in a news release.

“But the Administration must also forgive some debt for all borrowers and fix our student loan system once and for all—including by fixing our badly broken income driven repayment system and creating a new Public Service Loan Forgiveness program that works for our public servants.”

“This is not too much to ask for: so I continue to urge the Biden Administration to deliver for student borrowers — and I continue to push the Administration to extend the pause until 2023 to make sure this all gets done before payments resume.”

In Washington state, a major student loan servicer, Navient, was slapped with a $45 million restitution settlement following an attorney general investigation into Navient’s predatory lending practices.

The allegations of unfair lending practices largely related to forbearance: Washington Attorney General Bob Ferguson stated in January that Navient “unfairly pushed borrowers into forbearance,” forcing borrowers into accepting high-interest accumulation without sufficient education of the benefits of income-driven repayment plans. When payments resumed, accumulated interest would be added to the principle, whereas income-driven plans offer the possibility of loan forgiveness after 20 to 25 years of qualifying payments, which can be as low as $0 per month.

Navient, the Sallie Mae offshoot that was once the nation’s largest student loan servicer, began transferring $5.6 million in loans owned by the U.S. Department of Education to a company named Maximus in January, which will service the loans under the brand “AidVantage” in Washington state.

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‘There’s so much more to do,’ says Sen. Murray of decision to extend student loan moratorium