The U.S. Department of Education said on Thursday that it will “aggressively” defend one of the key planks of the Biden administration’s student loan forgiveness program after the 8th Circuit Court Appeals issued an order prohibiting its implementation.
Some Republican led states have challenged the government’s effort to forgive a number of student loans. In June, judges had ordered a stop to parts of the Biden administration’s education debt forgiveness plan, known as the SAVE plan, that works to help borrowers get their loans cancelled sooner. The program allows for borrowers who took out $12,000 or less for college, to see their debt forgiven after making 10 years of payments.
On Thursday, the 8th Circuit ordered a stay on the delivery of the rest of the program, Reuters reported, as legal questions around the issue are being adjudicated.
“We are assessing the impacts of this ruling and will be in touch directly with borrowers with any impacts that affect them,” an education department spokesperson told Newsweek in a statement. “Our Administration will continue to aggressively defend the SAVE Plan – which has been helping over 8 million borrowers access lower monthly payments, including 4.5 million borrowers who have had a zero dollar payment each month.”
They added: “We won’t stop fighting against Republican elected officials’ efforts to raise costs on millions of their own constituents’ student loan payments.”
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The Appeals Court decision creates uncertainty for borrowers, some experts say.
“The whole plan for now has to be paused,” Indivar Dutta-Gupta, a higher education expert, told Newsweek. “The uncertainty is around what happens for those who are already in and of course people who are waiting to get in, but they can’t. So, say you already applied, but the department of education not approved it yet. The department of education could not go and approve it. They have to wait for this to be sorted out.”
The case in question is being led by Missouri’s Republican Attorney General Andrew Bailey along with other other state’s top law enforcement officers who have argued that the forgiveness would cost Americans hundreds of billions of dollars. On Thursday, Bailey celebrated the court’s stay of the plan.
“The Court granted our emergency motion to BLOCK Joe Biden’s entire illegal student loan plan, which would have saddled working Americans with half-a-trillion dollars in Ivy League debt,” he posted on X, formerly Twitter. “HUGE win for every American who still believes in paying their own way.”
Earlier on Thursday, the education department announced the latest move by the Biden administration to forgive student loans. An additional $1.2 billion worth of debt for 35,000 public service workers was approved for cancellation, the department said in a statement, bringing the total borrowing that has been forgiven to $169 billion for nearly 5 million borrowers. The SAVE plan alone has helped eliminate $5.5 billion worth of student loans for more than 400,000 people.
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Newsweek is committed to challenging conventional wisdom and finding connections in the search for common ground.
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