The Center for American Progress (CAP) has sent a letter to U.S. Secretary of Education Miguel Cardona, urging an extension of credit protections for student loan borrowers amidst ongoing legal uncertainties. The letter underscores the difficulties faced by the U.S. Department of Education and loan servicers in providing adequate support during this period.

During the COVID-19 pandemic, the Biden-Harris administration implemented a pause on student loan repayments to alleviate financial pressure on borrowers. This pause expired in September 2023, with payments resuming in October 2023. To assist financially vulnerable borrowers, the Department of Education introduced a 12-month on-ramp aimed at preventing delinquency, credit damage, or collection actions.

This provision is set to end on September 30, 2024. Given the continued uncertainty surrounding student loan repayment due to various legal challenges, CAP argues that borrowers require ongoing support.

In its letter, CAP:

- Describes the necessary support for both borrowers and the Education Department amid ongoing repayment challenges.

- Highlights unresolved financial issues and other barriers hindering borrowers from making payments.

- Calls for an extended on-ramp to provide continued support to borrowers.

“Our nation’s student loan repayment system is plagued with widespread dysfunction,” said Stephanie Hall, senior director of Higher Education Policy at CAP. “Borrowers deserve to be protected from the financial consequences of the chaos erupting in our legal system—which is why the Center for American Progress is calling for an extension of the student loan repayment on-ramp.”

For more information or to speak with an expert, contact Mishka Espey at [email protected].