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How the student loan payment pause affected Latinx millennials

With payments due again soon, will Biden offer any loan forgiveness?

Student debt holders demonstrate outside of the White House on July 27. (Jemal Countess/Getty Images)

Since March 2020, federal student loan repayments have been on pause. With that pause scheduled to end Aug. 31, many borrowers are anxiously waiting to see whether President Biden will offer any student loan forgiveness, as promised during his campaign.

How has the pause affected millennials’ lives?

For the past 14 years, I’ve tracked a cohort of 60 Latinx millennials, most children of immigrants and childhood arrivals, who were college students in 2008. Most took out student loans. Most recently, I interviewed many of them in 2018-2019, before the student loan repayment pause, and again this April through July, as the pause has been set to expire. I found that for those carrying debt, the pause didn’t just help them to make ends meet during the pandemic — it also enabled them to provide for parents and other kin, pay off consumer debts, have weddings, plan families and start saving toward homeownership.

Latinx graduates and the student loan burden

The graduates I interviewed attended three different colleges in California: a private liberal arts college, a public research university and a regional public university. Most are children of Mexican immigrants and the first in their family to attend college. By 2018 and 2019, the impact of student loans on them was clear. Repayments were a burden on their emotional well-being and limited their life choices. Over half were helping their parents financially, either giving them money outright or living with parents and covering rent and mortgages. Such assistance is common among Latinx immigrant families, making the burden of student loans even heavier.

Deidra, for example, was 27 and living with her immigrant parents and two adult siblings when I spoke to her in 2018. (Note: All names used here are pseudonyms in keeping with the study’s guarantees of confidentiality.) Although she was working full-time as a counselor, most of her income went toward loan repayments and helping her parents pay off debt accrued for her own and her sister’s education. Financial stress was taking its toll: Deidra cried when talking about her debt and shared that she was delaying marriage and having children.

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The pandemic and the pause

Then in 2020, the coronavirus hit — and it hit Latinx communities particularly hard. Latinx people were more likely than any other ethnic-racial group to work jobs deemed “essential.” They were more likely than White people to get sick, have trouble accessing care and die of the virus.

For the interviewees I caught up with in 2022, 80 percent of whom had student loan balances, the repayment pause was welcome news. Deidra recently married and is planning to have children soon. She and her husband were finally able to have a wedding and start saving for a house.

Melinda, also the child of Mexican immigrants, holds a master’s in counseling and is expecting her first child. She does not yet qualify for paid maternity leave through her employer, so the repayments pause has eased some of her anxiety about “all of the expenses” associated with motherhood.

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The American Dream

Like many Americans, these graduates grew up hearing that college was the key to success. As immigrants and children immigrants, they sought to realize this dream for themselves and their parents. A decade after graduating, however, they have a more critical perspective.

Carlos grew up poor and is the first in his family to go to college. He recalls being told that “when you go to school, you’ll get out of here.” But after two degrees, including a master’s of social work from a prestigious private university, he says, “I still feel like I haven’t really moved too far out of my social class, which is something that we all want to do. … I’m kind of in the same place.” Even with the repayment pause, he says, “I feel a lot of relief whenever I have a chance to pay off something … But this is something that I never will.”

Karla took out most of her loans to get a master’s in industrial engineering. She now lives in a single-family home with her partner, two adult siblings, her mother and an in-law. She observes, “It doesn’t make sense, in my head, to pay all of this interest for student loans and to continue to pay for it for years … You’ve essentially paid off whatever you borrowed; you still have almost double the amount in interest payments.”

Karla adds that debates about who “deserves” loan forgiveness are “really hard to hear” when they don’t take race, ethnicity and generational class privilege into account. When people say, “Well, you could have chosen a different, cheaper college,” she explains, “you don’t understand what it’s like to be a first-Gen Latina and have to choose what colleges to go to. It’s not just: ‘Oh, it’s the cheapest.’ It’s: ‘Do you have support from the staff? Is there diversity?’… There’s so many things … that inform our decision on what college to go to.”

The question of who has to take out loans in the first place is far from neutral. Seventy-two percent of Latinx students finish four-year undergraduate programs with debt, compared with 66 percent of White students.

Loan forgiveness would allow these graduates to pursue basic goals shared by many: to make ends meet, start families, save for retirement and start saving to buy a home. What makes their stories distinct is the impact of student loan debt across generations. Latinx children of immigrants are more likely to live in multigenerational homes and more likely to financially support their parents compared with other racial and ethnic groups. Forgiveness doesn’t just benefit the borrower; it benefits their children and their parents.

As sociologist Tressie McMillan Cottom puts it, “The people making the rules did not talk straight with the American people about what college debt would actually cost, how it would work, and what it would mean for economic mobility.”

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Daisy Verduzco Reyes (@direyes29) is associate professor of sociology at the University of California Merced and author of “Learning to Be Latino: How Colleges Shape Identity Politics” (Rutgers University Press, 2018).