on friday, president biden in the wake of the supreme court ruling announced steps he ll take to try to bring relief to borrowers. to compromise, waive, oh release loans, we re creating a temperature ranger 12 - temporary 12-month on-ramp repayment program. now, this is not the same as a student loan pause. if you miss payments, this onramp temporarily removes the threat of default or having your credit harmed. reporter: cnn analyst katherine rampel says borrowers should not expect those ideas to be a great plan b. if those were on a strong legal foundation, i think he probably would have done them already. reporter: the economy could take a hit now that millions will have to start paying down student loans again. it will mean less spending on cars, vacations, appliances. for many, burdens on longer term plans could return. when you have student loan debt that you can t cover, it often results in people delaying
law. just moments ago secretary cardona took the first step to initiate that approach. we re not going to waste any time on this. it s going to take longer but we re getting on it right away. second, we know what many borrowers will need to make their hard choices which their budgets are being strained now when they start to repay their monthly loan payments. we know now figuring out to make these monthly expenses can take tame for borrowers and might miss payments on the front end. normally this can lead borrowers to fall into dedelinquency and default. it will hurt their financial security and that s not good for them or the economy. that s why we re creating a temporary 12-month what we re calling on-ramp repayment program. this is not the same as the student loan pause. it s been in effect for the past three years.
wiped out and they d never have to pay another interest payment again. well, actually be surprised to find this fall they too owe payments. for federal buyers who had payments paused during the pandemic they ll be due again starting in august. today president biden in the wake of the supreme court ruling announced steps he ll take to try to bring relief to borrowers. to compromise, waive, or release loans under certain circumstances we re creating a temporary 12-month what we re calling on-ramp repayment program. and it s about the same of a student loan pause. if you miss payments this on-ramp temporarily removes the threat of default or having your credit harmed. reporter: but cnn analyst catherine rampell says borrowers should not expect those ideas to be a great plan b. if those were on a strong legal foundation i think we probably would have done them already. reporter: analysts say the economy will take a hit now that
relief. just moments ago, secretary cardona took the first step to initiate the new approach. we re not going to waste anytime on this, we re it will take longer, but we re getting on it right away. second, we know what many borrowers will need to make the hard choices which their budgets are on a strain now when they start to repay their monthly payments this fall. we know it can take time and they might miss payments at the front end as they get back into repayment. normally this could lead to delinquency and default and it would hurt their financial security and that is not good for them or the economy. that is why we re creating a temporary 12 month what we re calling on-ramp repayment program. now, that is about the same as the student loan pause that has been in effect the past three years. monthly payments will be due.
out how to pay these expenses can take time for borrowers and they might miss payments on the front end as they get back into repayment. normally this can lead them to f fall into default. that will hurt financial security. it s not good for them or the economy. that s why we re creating a temporary 12-month what we re calling on ramp repayment program. this is not the same as a student loan pause. it s been in effect the past three years. monthly payments will be due, bills will not go out and interest will be accruing. during this period, if you can pay your montly bills, you should. if you cannot, if you miss payments, this on ramp temporarily will remove the threat of default or having your credit harmed which can hurt borrowers for years to come. because the department of education won t refer borrowers. the reason that will not work, they won t referboroers that