The US Supreme Court has announced that it will review the legality of the Biden administration’s plan to forgive student loans in early 2023.
Culmination of Legal Challenges
On Thursday, the Supreme Court said in an injunction that a national injunction on President Joe Biden’s student loan forgiveness plan remains in effect for now, but will hear arguments about the program’s legality in the near future.
The oral hearing is currently scheduled for February 2023, and a decision is expected in June of the same year.
Two separate court orders blocked the student debt relief plan. The order, which is under review by the Supreme Court , was issued by the U.S. Circuit Court of Appeals for the 8th Circuit.
Six states – Arkansas, Iowa, Kansas, Missouri, Nebraska and South Carolina – have argued that the president has exceeded his powers with the loan forgiveness program and this is threatening the revenues of their government loan officers who benefit from the payments. Federal Student Loans.
The Republican-run states’ case was dismissed, but they sought an injunction pending an 8th Circuit appeal, which was granted. However, on November 18, the Biden administration asked Assistant Judge Brett Kavanaugh, who has jurisdiction over emergency injunctions related to the 8th Circuit, to stay the injunction in question.
The other block was the result of a separate court order. The original lawsuit was filed by the Job Creators Network on behalf of two borrowers who argued that the plaintiffs were wrongly excluded from the student debt relief program.
On November 11, US District Judge Mark Pittman ruled in favor of the plaintiffs and discontinued the program. The Department of Justice shortly thereafter filed an appeal with the US Circuit Court of Appeals for the 5th Circuit, which was denied the day before the Supreme Court’s announcement.
Debt Relief Plan Status
Biden, who pledged $10,000 in student debt forgiveness during his campaign, unveiled his student loan forgiveness program in August 2022. Pell Grant ( private student loans are not exempt).
To date, a total of more than 40 million borrowers are eligible for debt relief, approximately 26 million Americans have applied for the program, and the US Department of Education has approved 16 million of these applications.
Though you were one of the lucky ones to have already filed an application, the US Department of Education has suspended the program while these lawsuits work their way through the court system.
While borrowers await final court rulings, the White House has extended the student loan payment pause, which now must end 60 days after the program begins or June 30, 2023, whichever comes first.