President Joe Biden has extended the freeze on federal student loan payments until Aug. 31, pushing the pause to the start of September. This marks the sixth extension on the student loan moratorium.

"We are still recovering from the pandemic and the unprecedented economic disruption it caused," President Biden said in his press release. "If loan payments were to resume on schedule in May, analysis of recent data from the Federal Reserve suggests that millions of student loan borrowers would face significant economic hardship, and delinquencies and defaults could threaten Americans' financial stability."

The freeze pauses payments for millions of Americans, who have collectively saved nearly $200 billion during the moratorium, according to an analysis from the Federal Reserve Bank of New York.

The extension on the moratorium follows calls from top Democrats who have been urging President Joe Biden to extend the student loan repayment pause and provide "meaningful" debt cancellation. They include Senate Majority Leader Chuck Schumer, Sen. Elizabeth Warren and Rep. Pramila Jayapal, chair of the Congressional Progressive Caucus. The letter calling on the White House to further pause student loans surfaced after Biden announced his budget proposal for fiscal 2023, which did not mention student loan cancellation or an extension to the federal student loan repayment pause.

"White House Chief of Staff Ron Klain's recent comments about potentially extending the payment pause and administratively canceling student loan debt are encouraging to millions of borrowers across the country," the letter reads. "Although there may be different ideas about the best way to structure cancellation, we all agree that you should cancel student debt now."

The letter makes reference to Klain's comments during a podcast on March 3, where he said that Biden was going to decide whether to cancel student debt before the pause expired, or extend the deferment. The following week, Department of Education officials started instructing companies managing federal student loans to pause sending notices about payments starting up again, as first reported by Politico.

"Restarting repayment will financially destabilize many borrowers and their families, and will cause hardship for many who could not afford repayment," the letter stated.

What you should know about the federal student loan payment pause

While on the campaign trail, Biden said he'd support legislation canceling a minimum of $10,000 of federal loans per borrower. However, the White House has been largely silent on the issue since Biden took office, though the Department of Education made moves on this front in the last couple of months.

Following the Department's revamp of its Public Service Loan Forgiveness program in October, 70,000 borrowers had their student loans extinguished, collectively reaching nearly $5 billion as of January. Subsequently, in March, the Department announced that approximately 30,000 more have been deemed eligible for relief under the Public Service Loan Forgiveness waiver.

Whether Biden has the legal authority to unilaterally cancel student debt through executive action, without legislation from Congress, is still unclear. The Department of Education released a memo (PDF) on this issue last year, but the highly redacted document offers little information for public eyes.

How did we get here?

Federal student debt repayments have been paused for two years now. Since the pause was first enacted, interest hasn't accumulated and collections on defaulted debt have been put on hold.

Former President Donald Trump first enacted the pause on student loans in March 2020 and extended it until January 2021. Biden extended the pause three more after taking office, with his administration warning that the January 2022 extension would be the last. 

However, with the omicron variant of COVID-19 sweeping through the US last year, Biden's administration decided to further extend the student loan repayment moratorium until May 1, 2022. 

Now, Biden has extended the loan repayment freeze again, pausing payments through the end of the summer.

"That additional time will assist borrowers in achieving greater financial security and support the Department of Education's efforts to continue improving student loan programs," Biden said.