Source: Sarah Sattelmeyer, New America

The Department of Education (ED) announced a four-month extension of the current student loan payment pause—which also includes pauses on interest and collections—through August 31, 2022.

The administration plans to allow “all borrowers with paused loans to receive a ‘fresh start’ on repayment by eliminating the impact of delinquency and default and allowing them to reenter repayment in good standing.”  Presumably, through fresh start, borrowers’ wages, tax refunds, and federal benefits will no longer be at risk of being garnished. And they will regain access to income-driven repayment (IDR) plans, Public Service Loan Forgiveness (PSLF), and federal financial aid if they want or need to return to school. 

Read Full Article: 8 questions about student loan default and “fresh start”