How Delaying Loan Repayment Hurt Student Borrowers

At the onset of Covid-19, the federal government chose to pause interest accrual on student loans to provide student borrowers financial relief. When unemployment climbed to 13 percent, and regulations at the state and local level restricted people’s ability to work for the sake of public health, such a reform seemed prudent. Dragging on well over halfway into the Biden presidency, however, the policy became increasingly troublesome. At what point would the government pull the plug? Would borrowers simply start repaying of their own volition?

Now, bills are coming due. And it looks like borrowers aren’t ready to go back to paying off their loans. Since the pause on interest accrual was lifted in October, only 60 percent of current

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Joe Pitts

Joe Pitts is a public-policy professional currently working in Washington, D.C. He is a native Arizonan.

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At the onset of Covid-19, the federal government chose to pause interest accrual on student loans to provide student borrowers financial relief. When unemployment climbed to 13 percent, and regulations at the state and local level restricted people’s ability to work for the sake of public health, such a reform seemed prudent. Dragging on well over halfway into the Biden presidency, however, the policy became increasingly troublesome. At what point would the government pull the plug? Would borrowers simply start repaying of their own volition?

Now, bills are coming due. And it looks like borrowers aren’t ready to go back to paying off their loans. Since the pause on interest accrual was lifted in October, only 60 percent of current