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Expert weighs in on possible extension of moratorium on student loan payments

INDIANAPOLIS (WISH) — Many college graduates have started to look for insight into the student loan debt crisis.

Millions of Americans have taken advantage of a moratorium on student loan payments. It was introduced early in the coronavirus pandemic and President Joe Biden has said he plans to make a decision to begin repayments by the end of the month.

Right now, student loan payments are scheduled to restart after Aug. 31.

If he extends the student loan moratorium, it would mark the seventh time the pause has been extended since March 2020. Former President Donald Trump extended it twice, and so far, Biden has extended it four times.

Many college graduates also hope the president will move toward forgiving a certain amount of student loans.

Phil Schuman, executive director of financial wellness and education for Indiana University, says, “If $10,000 was forgiven, the borrower would save about $100 a month, depending on interest and how much they owe.”

Schuman says the federal government has told loan servicers not to contact borrowers about restarting payments.

“From what I understand, they need about 30 days in advance to get the gears moving again so that they can get all the necessary paperwork and contact information put together so they have enough time to reach out to the borrowers and say, ‘Hey, in one month’s time, your payments would start back up again. Here’s what this means for you.’”