BURLINGTON, Vermont (WCAX) – More than 43 million student borrowers will have more time before they need to start repaying their federal student loans.
It started at the start of the pandemic and was due to expire on May 1, 2022.
However, on Wednesday, the Biden administration announced a new freeze on federal student loan repayments. This time until August 31, 2022.
“They want to have a solution in place before they lift the moratorium,” said Michael Kitchen, senior editor of Studentloanhero.com. “Before this most recent extension, the White House had said that we were either going to extend the moratorium or find some sort of solution that would perhaps invest some form of forgiveness.”
Studentloanhero.com was founded to help student borrowers organize, manage, and pay off their student loan debt.
In a survey the company conducted last month, of 945 people surveyed, 58% said they hadn’t made any payments since the start of the hiatus.
On the other hand, 22% of people have made their monthly payments.
“If you have the money to do it, this is a great way to do it,” Kitchen said. “If you don’t pay interest, all the money goes straight to the principle. So you can really do without it.
The company says 75,000 Vermonters have federal student loans. Green Mountain State ranks 13th in the nation for average federal debt, at more than $37,000 per person.
Kitchen says throughout the 25-month hiatus, on average, Vermonters on refunds saved more than $7,000 during that time.
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