The U.S. Department of Education has directed the companies that service federal student loans not to send out notices about payments restarting in May, according to two people familiar with the matter.
Servicers that would have sent out the reminders to borrowers at the end of the month are now holding off.
The news is the clearest sign yet the the Biden administration is considering extending the payment pause for federal student loan borrowers once again. It remains unclear how much more time, if any, borrowers may get.
Since March 2020, when the coronavirus pandemic first hit the U.S. and crippled the economy, most federal student loan holders have been given the option not to pay their monthly bill and interest hasn’t been allowed to accrue on their debt in the meantime.
A spokesperson for the Education Department said it will continue communicating regularly with servicers about “the type and cadence” of outreach to borrowers.
The reprieve impacting more than 25 million Americans has been extended five times throughout the public health crisis, and is currently slated to end on May 2.
However, White House Chief of Staff Ron Klain said earlier this month that the Biden administration wanted to make its decision around debt cancellation before it turned the payments back on.
“The president is going to look at what we should do on student debt before the pause expires, or he’ll extend the pause,” Klain said on the podcast “Pod Save America.”
On the campaign trail, President Joe Biden promised to quickly cancel $10,000 per borrower, but he’s increasingly under pressure from some Democrats and advocates to wipe out more. Senate Majority Leader Chuck Schumer, D-N.Y., and Sen. Elizabeth Warren, D-Mass., are pushing him to cancel up to $50,000 for all.
A recent poll found that nearly 66% of likely voters are in support of Biden canceling some or all of student debt, with more than 70% of Latino and Black voters in favor.
For now, it’s clear that the White House is responding to the pressure, said Thomas Gokey, co-founder of the Debt Collective, a national union of debtors.
“A few months ago they were adamant they had extended the payment pause for the last time,” Gokey said.