On August 8, President Donald Trump signed a memorandum ordering Education Secretary Betsy DeVos to extend the student loan relief policies included in the CARES law which were to expire on September 30 until the end of December.
Friday, 21st of August DeVos implemented the measure, providing student borrowers with additional relief for three months.
The CARES law, passed March 27, suspended federal student loan repayments and temporarily set the federal student loan interest rate at 0%.
“All borrowers with federal student loans will have their payments automatically suspended until 2021 without penalty,” it reads a statement by the secretary. “In addition, the interest rate on all student loans held by the federal government will be set at 0% until the end of the calendar year.”
According to the most recent figures from the Ministry of Education, approximately 42.6 million federal student loan borrowers collectively owe more than $ 1.5 trillion in federal student debt.
DeVos’ announcement also extended protections for borrowers with federal student loans in default to have their wages garnished during that time. However, the Trump administration has faced serious criticism as well as class action lawsuits for failing to end wage garnishment completely during the pandemic.
According to the statement, full-time workers who meet the conditions Public service loan forgiveness program (such as teachers and Peace Corps volunteers) will have the next three months counted in the 120 payments they must make before their debt is canceled, although the Trump administration has has already tried to eliminate the program.