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How Student Loan Repayments Could Hurt US Economy

Giulia Carbonaro

The resumption of student loan payments after a three-year break, is likely to deliver a blow to American economic growth, according to economists, in a move that could harm many beyond borrowers alone.

"After three years of successful student loan forbearance we know one thing is true—people stopped paying their student loans and the sky didn't fall," Angela Hanks, chief of Programs at Demos and former Biden administration official, told Newsweek in a written statement.

"The forbearance also helped ensure that people did not face financial ruin as a part of a pandemic they did not cause, and borrowers found themselves on more solid financial footing, for many, for the first time in years," she said.

"This meant that people were able to pay other bills on time, including basics like rent and groceries. For the millions of borrowers who will be forced into repayment in just a few weeks, this transition will undermine whatever stability they've been able to create for their families over the last few years."

Read the full article in Newsweek