ELMIRA, N.Y. (WETM) – 40 Million Americans will have to start paying back their debt.
When COVID-19 first happened, the government put a pause on payments to banks and lenders due to the economy and the job market crashing.
As the pandemic continued, people experienced more hardship within their finances, which made it harder to make payments toward their student loans.
The Biden Administration launched the COVID-19 Emergency Relief program in January of 2021. This bill put a stop to payments to help low-income citizens who were struggling during this period.
The economy is now making its way back to normalcy with businesses reopening. As a result, banks are now looking to collect the debt that was once stopped due to the pandemic.
“The banks and the federal government need to be flexible and try to help people the best they can if they are not able to you know, if they if they can prove they don’t have an income if they’re on unemployment, I mean I totally agree,” said Matthew Burr Elmira College professor, “I think we need to potentially be flexible and try to find opportunities to work with people and not you know not handcuff them with, you know, a seven or eight percent interest rate and, you know, killing their credit and things like that that doesn’t serve a purpose at all in my opinion for anybody, it’s just going to hurt the economy long term.”
According to EducationData.Org approximately 42.9 Million Americans with federal student loan debt each owe an average of $36,406 for their federal loans.
As of September 31, 2021, The COVID Emergency Relief program will no longer be in effect. Both the federal student aid and loan servicer will contact individuals directly about restarting payments.