This Ultra Cheap Lending Stock Is Up 21% in June. Is It a Buy?
After much debate, the U.S. government reached a deal on the debt ceiling limit in late May. Government officials agreed to restart student loan repayments as part of the bipartisan deal. Student loan payments were put on pause as part of pandemic relief policies put in place in March 2020. After being extended multiple times, repayments will resume for borrowers for the first time in three years.
Following the news, many student lending stocks popped higher. Navient (NASDAQ: NAVI) is one student lender whose stock jumped 30% in the days following the deal. The company is sure to benefit from the deal, but there are other factors you must consider before diving into the stock.
The student loan repayment freeze began in March 2020 at the beginning of the pandemic. This moratorium not only put loan payments on pause but also stopped the accumulation of interest to help borrowers weather the economic fallout from the pandemic. Since then, the measure has been extended on nine separate occasions, providing 44 million borrowers of federal loans some relief over the past three years.
Source Fool.com
