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Student Loan Borrowers Are On Notice Now That Biden’s Leaving: You Have To Pay It Back

Charlie Kirk Staff

12/02/2024

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Student Loan Borrowers Are On Notice Now That Biden’s Leaving: You Have To Pay It Back

Federal student loan borrowers who miss payments will once again face financial repercussions, according to a Monday report.

Following the expiration of the COVID-19 pandemic-era payment pause in September 2023, the Biden administration implemented a one-year grace period, protecting borrowers from the consequences of missed payments, CNBC noted.

Now that the grace period has ended, borrowers who fail to make their payments are at risk of collection efforts resuming.

Borrowers can expect multiple notifications from their student loan servicers before falling into delinquency or default, according to higher education expert Mark Kantrowitz.

Typically, payments must be about 90 days overdue before being reported to credit rating agencies, Kantrowitz explained. He added that the consequences of default usually occur between 270 and 360 days of missed payments, CNBC said.

According to Kantrowitz, these consequences may include garnishment of up to 15% of your wages and Social Security benefits. Additionally, borrowers with defaulted federal student loans could lose eligibility for mortgages backed by the Federal Housing Administration (FHA) or the U.S. Department of Veterans Affairs (VA).

“Borrowers should not let it get this far,” Kantrowitz said.

Biden repeatedly forgave student loan debt throughout his presidency, but many of those giveaways have been successfully challenged in court.

Meanwhile, CNN reported in October that the 8th U.S. Circuit Court of Appeals is expected to rule soon on a Republican-led lawsuit challenging President Joe Biden’s student loan repayment plan, following oral arguments.

The plan, known as SAVE (Saving on a Valuable Education), aims to reduce monthly payments and shorten the time to qualify for student loan forgiveness. While it was launched last year, its implementation has been on hold since July due to ongoing litigation.

Biden introduced the SAVE plan after the Supreme Court struck down his one-time student loan forgiveness program. If the plan moves forward, it could represent the most significant reform to the federal student loan system during Biden’s presidency.

Currently, eight million borrowers are enrolled in the program.

The lawsuit was filed in April by attorneys general in Missouri, Arkansas, Florida, Georgia, North Dakota, Ohio and Oklahoma.

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Charlie Kirk is the Founder and President of Turning Point USA, a national student movement dedicated to empowering young people to promote the principles of free markets and limited government.

Charlie is also the host of “The Charlie Kirk Show” podcast, which regularly ranks among the top-10 news shows on Apple podcast news charts, and is the host of the nationally syndicated daily radio show on the Salem Radio Network live from 12 - 3 PM ET.
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