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  • The Education Department told student-loan companies to halt outreach on the payment restart date.
  • Politico first reported the development as the latest sign payments might not resume on May 1.
  • Ron Klain said Biden will either extend the pause, or look at what else he can do on the issue.

President Joe Biden may have told student-loan borrowers to prepare for their payments to resume on May 1, but it’s looking like his Education Department could be preparing to push that date back.

Politico first reported on Tuesday that the Education Department directed federal student-loan companies to halt sending notices to borrowers about the payment resumption, according to sources familiar. Typically, leading up to the date loan payments are expected to resume, companies would alert borrowers to begin preparing to pay off their debt. The instruction to hold off on those notices may signal Biden will extend the student-loan payment pause a fourth time.

“From Day One, the Biden-Harris Administration has been committed to providing meaningful relief to student loan borrowers including the 41 million borrowers who have saved tens of billions as a result of the extended student loan payment pause,” an Education Department spokesperson told Insider. “The Department will continue communicating directly with borrowers about federal student loan repayment by providing clear and timely updates. The Department’s Federal Student Aid office will also continue communicating  regularly with servicers about the type and cadence of servicer outreach to borrowers.”

Federal student-loan payments have been on pause, with waived interest, for the duration of the pandemic, giving 43 million borrowers temporary relief as the $1.7 trillion student debt crisis continues to grow. While Biden extended the pause a third time through May 1, citing uncertainty with the Omicron variant, he continues to face pressure from some advocates and lawmakers who want him to either keep extending the pause until reforms to the student-loan industry are implemented, or until he cancels student debt broadly.

Based on recent developments, the pressure on Biden might be working. White House Chief of Staff Ron Klain told Pod Save America last week that Biden will either extend payment pause again, or review actions he can take on student debt before May.

“The President is going to look at what we should do on student debt before the pause expires, or he’ll extend the pause,” Klain said, adding that “the question whether or not there’s some executive action on student debt forgiveness when payments resume is a decision we’re going to take before payments resume.”

While Republican lawmakers have decried another student-loan payment pause extension, citing its cost to taxpayers and the economy, some Democrats have argued the opposite — they say canceling student debt would be an economic stimulus, and it would also lend success to their party at the voting polls, given that Biden promised voters during his campaign he would approve $10,000 in student-debt relief. 

“The ultimate persuasion is impact, and Democrats win when we deliver bold, impactful policies that improve the daily lives of our constituents,” Massachusetts Rep. Ayanna Pressley told Insider last month. 

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