Nearly nine million individuals failed to make their initial student loan payment following the conclusion of the pandemic-induced payment hiatus this autumn, as reported by the Department of Education on Friday.
This represents approximately 40% of the 22 million individuals required to make student loan payments in October. The nearly nine million borrowers did not fulfill their payments until well into November. In comparison, less than 26% of borrowers missed payments in October 2019, prior to the initiation of the pandemic-related payment pause.
The payment pause commenced in March 2020 amid the COVID pandemic and concluded in October, spanning over three years.
According to the Department of Education’s preliminary analysis of repayment data after the pause, over 28 million borrowers are expected to resume payments.
The Department of Education acknowledged that some borrowers may be bewildered or overwhelmed regarding their options and emphasized their commitment to supporting student loan borrowers during the transition back to repayment.
The Biden administration has introduced an “on-ramp” program for the next year to shield borrowers from the most severe consequences of missed payments, such as delinquency, default, and mandatory collections. This initiative aims to provide additional support and assistance to borrowers navigating the challenges of resuming their student loan payments after the extended hiatus.
great article