Following an appeal from six GOP-led states, a federal appeals court temporarily halted President Biden’s student loan forgiveness program. The policy to forgive thousands of dollars in student loan debt was ordered to be suspended until legal challenges are resolved, according to a decision made on Friday by the U.S. Court of Appeals for the 8th Circuit.
By Monday night, the Biden administration must reply to the appeals court’s case. Under Biden’s proposal, holders of federal student loans making less than $125,000 year might have up to $10,000 of their debt forgiven. Pell Grant recipients were eligible for reimbursement of up to $20,000.
The decision follows a federal district judge’s dismissal of the states’ case on Thursday due to lack of standing.
Following the application’s publication on Monday, the president stated earlier on Friday that more than 22 million individuals had submitted applications for student loan debt forgiveness. The duration of the legal battles is yet unknown. However, student loan payments will restart at the start of 2019 after loan freezes were extended by both previous Presidents Trump and Biden during the epidemic.
The case was initially brought by the attorneys general in September, with the justification that Congress had not given the Biden administration permission to cancel the debt.
However, according to U.S. District Judge Henry Autry, they failed to show that the relief will cause them actual injury, which is required to satisfy the standing requirement. However, he did mention that they posed “major and serious” obstacles to Biden’s strategy.
The loan forgiveness programme has faced several legal challenges. Earlier this week, a group of Wisconsin taxpayers attempted to halt the plan urgently, but Supreme Court Justice Amy Coney Barrett denied their application.
The Higher Education Relief Opportunities for Students Act of 2003, according to the Biden administration, gives it the right to forgive debt. In cases of “national emergency,” the law permits the secretary of education to forgive student loan arrears.
In response to the decision on Friday, the White House promised to reject GOP efforts to block the president’s forgiveness proposal from moving forward.
The decision, according to White House press secretary Karine Jean-Pierre, does not prevent borrowers from requesting relief or the government from examining applications. Simply put, the government is unable to provide assistance until the appeals court rules on the matter.
Additionally, the president attacked Republicans who contend that providing debt relief to borrowers is unfair in remarks he made from the Delaware State University on Friday.
“Ted Cruz, the legendary senator from Texas, claimed that it is just for slackers who, quote, “don’t deserve assistance.” What the heck do they think they’re doing? said Biden.
He said, “I don’t want to hear it from MAGA Republican leaders who had millions of dollars in epidemic relief loans canceled debts and are now condemning me for assisting working- and middle-class Americans.
