A Washington Post analysis finds that the federal student loan payment pause introduced during the COVID-19 pandemic changed household finances in ways that extended beyond temporary relief. Many borrowers appear to have taken on new forms of debt while their student loan payments were suspended, leaving some with greater financial pressure after repayments resumed.
The analysis suggests that the pause altered borrowing behavior for millions of Americans. While officials from both the Trump and Biden administrations have defended the policy as necessary during the economic disruption caused by the pandemic, researchers say many borrowers emerged from the repayment freeze with larger financial obligations than before.
Borrowers Accumulated New Debt While Student Loan Payments Were Suspended
The federal government paused payments and interest on most federal student loans in March 2020 as the coronavirus pandemic disrupted the economy. The policy remained in place for more than three years after being extended by the Biden administration, while a proposal to forgive a portion of student debt was later blocked by the Supreme Court in June 2023.
According to The Washington Post, the payment pause provided millions of borrowers with additional monthly cash flow, which many used to finance other expenses, including auto loans, mortgages, and credit card balances. Some borrowers also reported using the temporary financial relief to cover everyday living costs after losing jobs during the pandemic.
Kathryn Rosenthal, who owed more than $20,000 in student loans when the pandemic began, said the suspension of payments helped her manage housing and transportation costs after losing two jobs. She later accumulated thousands of dollars in credit card debt and said she did not fully consider how she would eventually repay both her student loans and her new obligations.
Research cited by The Washington Post found similar patterns across larger groups of borrowers. A National Bureau of Economic Research working paper reported that borrowers had about $280 more available each month during the pause, and people without college degrees reduced their work hours by 11% on average. Another study found that borrowers with paused student loans increased their debt on credit cards, auto loans, and mortgages by an average of about $1,200 instead of reducing existing balances.
Economist Michael Dinerstein told the newspaper that researchers were surprised many borrowers made long-term financial commitments rather than limiting additional spending to short-term needs.
Delinquencies Rise as Repayments Resume and Relief Programs Change
Once federal student loan payments resumed, many borrowers faced repayment obligations alongside the additional debts accumulated during the pause. According to The Washington Post’s analysis of New York Federal Reserve Consumer Credit Panel and Equifax data, 10.3% of student loan balances were at least 90 days delinquent during the first quarter of 2026, approaching pre-pandemic levels.
The analysis also found broader signs of financial strain. Auto loan balances increased by nearly 30% between 2019 and early 2026, reaching $1.69 trillion, while credit card balances rose by more than 50% to $1.25 trillion. During the same period, credit card delinquency climbed to 13.1%, and auto loan delinquency reached 5.6%.
Older borrowers experienced some of the highest student loan delinquency rates. Borrowers aged 50 and older reached a serious delinquency rate of 22.4% during the third quarter of 2025, a shift partly linked to the growth of Parent PLUS loans.
The report also notes that repayment options are changing again. The Biden administration’s SAVE repayment plan is being phased out, and the Trump administration is introducing two new repayment plans beginning July 1. Some borrowers interviewed by the newspaper said the revised payment structures could significantly increase their monthly obligations, adding further pressure as they manage student loans alongside mortgages, vehicle financing, and credit card debt.
