‘Hallelujah:’ pause on student loan payments extended until August

This moratorium was set to expire on May 1, but now the federal government is giving people more time until they need to pay toward their loans.
Student loan payments were scheduled to resume May 1 after being halted since early in the pandemic.
Published: Apr. 6, 2022 at 6:44 PM EDT
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CHARLOTTE, N.C. (WBTV) - Student loan payments are on pause once again.

On Wednesday, the Biden administration announced it was extending the pause on student loan payments and maintaining the 0% interest on current loans.

This moratorium was set to expire on May 1, but now the federal government is giving people more time until they need to pay toward their loans.

“If loan payments were to resume on schedule in May, analysis of recent data from the Federal Reserve suggests that millions of student loan borrowers would face significant economic hardship, and delinquencies and defaults could threaten Americans’ financial stability,” President Biden said.

Related: White House to extend student loan pause through August

Jil Harris attended The University of North Carolina at Greensboro, but left her degree program in 2015. She was originally told she could use her dad’s Veteran’s Affairs benefits which would’ve paid for everything. She wasn’t able to use the funds and instead had to take out student loans.

She was full of joy when she heard about the payment deadline being extended.

“Hallelujah! Thank you so much,” Harris said.

According to the Education Data Initiative, more than 43 million borrowers have student loan debt.

She’s got more than $20,000 in student loan debt and says the payment delays we’re helpful with saving money and making interest-free payments.

“Just that elimination of interest really was a big help for me,” Harris said.

She was unemployed in the beginning of 2020 and used the extra $200-$300 a month to start her own freelancing business as a videographer and editor, while also saving and paying toward other bills.

“It freed up the money and freed up my mind really because I didn’t have this burden of ‘okay I have to pay for student loans so I can’t afford this camera or this software,” she said.

UNC Charlotte’s director of financial aid Bruce Blackmon says the extended payment delays are a good way to save but it’s also a benefit to pay off your debt without the extra interest.

“If the student pays on their loan now, 100% of what they pay will actually go to the principal. They’re not having to worry about paying down interest so that’s better for the student in the long term,” Blackmon said.

Harris says she’s also making payments on her student loans and encourages people to do what’s best for them.

“Be smart with your money whether that is putting a little bit toward your payment or it’s just saving up for something else for later,” she said.

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