- A Roosevelt Institute analysis found restarting student-loan payments will strip $85B from 18M borrowers next year.
- Elizabeth Warren, Chuck Schumer, and Ayanna Pressley cited that data in urging Biden to extend the pause.
- Calls are ramping up for a further extension, given payments are set to resume in 55 days.
In the latest push for President Joe Biden to further extend the pandemic pause on student-loan payments, three Democratic lawmakers received data showing just how hard millions of borrowers will be hit.
The Roosevelt Institute — a progressive think-tank — published an analysis at the request of Massachusetts Sen. Elizabeth Warren, Senate Majority Leader Chuck Schumer, and Massachusetts Rep. Ayanna Pressley that details how much the payment restart will affect the economy. It found resuming student-loan payments on February 1 will "strip" 18 million borrowers of $7.12 billion a month and $85.48 billion annually over the next year. That's money that was used during the pandemic to afford basic necessities and pay off other forms of debt.
The lawmakers wrote in a Wednesday letter to Biden that "to prevent the student debt crisis from dragging down on our economic recovery, undermining the effectiveness of the American Rescue Plan, and causing unnecessary pain and stress for American families, we strongly urge you to extend the pause on student loan payments and interest and act to cancel student debt."
The analysis looked at the 60% of the 43 million total borrowers in the US affected by the payment pause and then took out the 7.7 million who are behind on payments. That left 18 million who, prior to the pandemic pause, paid an average of $393 per month toward their loans.
In recent days, calls have been amplifying for Biden to extend the student-loan pandemic relief measures. Schumer urged Biden on Monday to extend the pause past February 1, citing the uncertainty the new Omicron variant brings.
"If we don't extend the pause, interest rates just pile up. Students owe a fortune," Schumer said. "And with omicron here, we're not getting out of this as quickly as we'd like."
The same day, 14 Democratic senators, including Georgia Sen. Raphael Warnock and Oregon Sen. Ron Wyden, sent a letter to Biden saying that if payments do resume, the president should continue to waive interest on those loans to prevent debt from accumulating even faster.
And on Thursday, over 200 organizations, led by the Student Borrower Protection Center, sent yet another letter to Biden calling on him to extend the pause until he fulfills his campaign promises of fixing loan forgiveness programs and cancelling student debt.
With payments resuming in 55 days, many borrowers worry they will not be able to afford their monthly student-loan bills. The Student Debt Crisis Center recently released a survey that found 89% of fully-employed borrowers do not feel financially secure enough to tackle payments next year, and Insider has spoken to borrowers who feel the same.
"Restarting payments makes me very anxious because I somehow have to find that extra $200," Gwen Carney, a single grandmother with $75,000 in student debt, previously told Insider. "I just don't have it."
The Education Department has not yet commented on a further student-loan payment pause extension.