Since March 2020, tens of millions of federal student loan borrowers have had the option to take a break from paying back their student loans without earning additional interest.
Now, after five extensions, three years and two presidents, that pause looks set to end.
On Wednesday, the House of Representatives will vote on a deal to avoid a historic government debt default by raising the nation’s debt ceiling for roughly two years. As part of a bipartisan compromise, the legislation includes a provision to restart student loan payments.
But, notably, it doesn’t touch on another highly-watched issue for borrowers: Biden’s plan to erase up to $20,000 in debt. The fate of that broader plan still rests in the hands of the Supreme Court.
Here’s what you need to know. What does the debt deal actually change for borrowers?
The deal spells out when repayments resume: 60 days after June 30. If the legislation passes, that means all federal student loan borrowers will be expected to start making payments again after August 29. Their loans will accrue interest then as well.
And this time, it looks like it would really be the end: The debt deal prohibits the education secretary from extending the pause on federal student loan payments without congressional approval.