FORT WAYNE, Ind. (WANE) — Federal student loan payments have once again been extended. The student loan freeze is now extended to Jan. 31, 2022.
“This extension gives borrowers 22 months in the term of a break of payment,” said Andrew Pentis, student loan counselor. “One thing worth noting from the Department of Education they are calling this the last extension.”
Pentis is a certified student loan counselor and a senior writer for Student Loan Hero by Lending Tree. His job is to help students and their families find the best ways to pay for college or repay their college debt.
According to a recent study by Lending Tree, the current total of U.S. student loan debt is $1.58 trillion. The study went on to show that Indiana was ranked 11th in the country for the most interested state for student loan forgiveness with the average Hoosier owning more than $30,000.
Since March 2020, federal student loans are in a forbearance period which allows those with loans to temporarily stop making payments. The forbearance that was scheduled to end in October will now end in January of 2022.
But what happened to student loan forgiveness?
President Joe Biden has talked about eliminating student loans since, forgiving $10,000 dollars in Federal Student Loan Debt for each person. So far no bills have been passed and no executive orders signed. Pentis says borrowers should not plan on student loan forgiveness happening any time soon.
“We are at a standstill,” Pentis said. “We don’t know what the next steps are. Certainly, in the state of Indiana, the average monthly payment is still above $250 so that is something that can cause havoc for families. Forgiveness is something a lot of people are waiting on.”
Pentis says that before payments restart, borrowers should have plans in place to resume making payments. He also says a bigger conversation needs to be had to educate students before they take on massive amounts of student loan debt.
“Here’s what an interest loan is, here’s what a loan actually is, here’s how to understand your repayment,” Pentis said. “With that information, hopefully, those students and their families will decide you know what I don’t need to attend fancy private four-year universities on the other coast, maybe I’ll stick with my community college for the first two years and then reevaluate.”
While student loans won’t be going away anytime soon, Biden is looking at regularity reforms of existing repayment student loans. The idea would be to forgive student loan debt for public servants on an annual basis instead of making them wait for a long amount of time.
This type of student loan forgiveness would be a part of the Public Service Loan Forgiveness Program. This program allows nurses teachers, and other public officials. However, your employer must be eligible for the program, not the student loan borrower.