Student Loans

Debt Ceiling Deal Will End The Student Loan Repayment Pause

If the debt ceiling bill passes, the Education Department will be barred from extending the student loan repayment pause yet again.


After over three years, federal student loan borrowers will likely have to start repaying their debt. According to the terms of a debt ceiling deal struck by House Speaker Kevin McCarthy and President Biden, the extended pause on student loan repayment will end on August 30th. 

While a previous announcement from the Education Department had vowed to end the pause on August 29provided the Supreme Court had not yet released a decision on Biden's student loan forgiveness planthe debt ceiling deal solidifies this promise. If the bill passes, the Education Department will be statutorily barred from announcing yet another last-minute extensionas officials have done on eight occasions since August 2020, including two separate continuations of supposedly "final" extensions.

While fiscal conservatives have decried the recent debt ceiling deal due to its lackluster cap on non-defense discretionary spending, solidifying a start date for student loan repayment is a clear win for anyone concerned by the extended pause in student loan repayment.

"The president says that it was his plan all along to return to repayment by the end of the summer," Rep. Virginia Foxx (R-NC) told The Hill. "While I wish I could take his words at face value, his past actions have showed me otherwise. Passing the Fiscal Responsibility Act is the only sure-fire way to force a return to repayment and prevent the president from issuing another illegal extension."

But the Biden Administration has also claimed the student loan-related portions of the debt ceiling deal as a victory, focusing on the fact that critical elements of Biden's student loan forgiveness proposal were spared, including the supercharged Income-Driven Repayment plan. 

"President Biden protected the student debt relief plan in its entirety," one White House spokesperson told Newsweek. "The Administration announced back in November that the current student loan payment pause would end this summer—this agreement makes no changes to that plan."

Many progressives are framing the end of a nearly three-and-a-half-year pause on paying their student loans as disastrous.

"Borrowers got sold out. That's, I mean, the general feeling that I'm having, and I know a lot of our supporters are having today," Natalia Abrams, president of the Student Debt Crisis Center, told The Hill. "Trying to say you've won here when, in fact, for so many borrowers, that payment pause has actually been by far more relief for borrowers that owe $100,000 or $200,000 than the one-time debt cancellation—and plus a lot of people don't have faith in that."

According to the Committee for a Responsible Federal Budget, the student loan pause costs taxpayers about $5 billion every month–bringing the total cost to almost $200 billion by the time repayment goes into effect.