The Daily
Is the Era of Student Loan Forgiveness Officially Over?
Apr 21, 2025
Stacy Cowley, a business reporter at The Times specializing in consumer finance, dives into the end of student loan forgiveness. She highlights the shockwaves this policy shift sends through millions of borrowers, with payments resuming after a lengthy pause. Cowley discusses the emotional toll and potential damage to credit scores, and how this reckoning on student debt may reshape public views on higher education funding. The conversation raises urgent questions about the future of student loans and the financial strain Americans now face.
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Quick takeaways
- The end of the student loan payment pause has led to millions facing delinquencies, severely impacting their credit scores and future financial opportunities.
- The chaos surrounding repayment systems and rising delinquencies has sparked critical discussions about the sustainability of the current educational financing model in America.
Deep dives
End of Student Loan Payment Pause
The U.S. government has officially ended a nearly five-year pause on student loan payments, requiring millions of borrowers to resume payments after being relieved during the pandemic. This sudden shift has resulted in approximately four million borrowers experiencing delinquencies on their credit reports, dramatically impacting their credit scores. Such delinquencies can lead to serious financial obstacles, including challenges in securing loans for significant purchases like homes or cars. Experts warn that if trends continue, up to nine million borrowers could default by the year's end, placing them in precarious financial situations.
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