Appeals court puts Biden student debt relief program on hold while it reviews the case


A federal appeals court placed a temporary administrative hold on President Joe Biden’s student loan forgiveness program, preventing the administration from canceling loans covered by the policy while the court considers the policy a challenge.

The order came from the 8th US Circuit Court of Appeals, in a case brought by six Republican-led states. A district court dismissed the case earlier this week, and the states are now asking the appeals court for a preliminary injunction halting the policy.

The appeals court gave the administration until Monday to respond to that request, and the states have until Tuesday to respond to that response. The states had asked the appeals court to act by Sunday, the earliest date the Biden administration had said it would grant student loan discharges.

Around 22 million people have already applied for debt relief since applications opened on 14 October.

The lawsuit, which was filed last month, was dismissed on Oct. 20 by a lower court judge who ruled that the plaintiffs lacked legal standing to mount the challenge.

In another victory for Biden on the same day, Supreme Court Justice Amy Coney Barrett rejected a separate challenge to the student loan forgiveness program brought by a Wisconsin taxpayer group.

The Biden administration is also facing lawsuits from Arizona Attorney General Mark Brnovich and conservative groups such as the Job Creators Network Foundation and the Cato Institute.

Many of the legal challenges argue that the Biden administration does not have the legal authority to generally cancel student loan debt.

Attorneys for the government argue that Congress gave the Secretary of Education the power to discharge debt in a 2003 law known as the HEROES Act.

Biden’s student loan forgiveness program, first announced in August, aims to provide debt relief to millions of borrowers before federal student loan payments resume in January after a nearly three-year pandemic-related hiatus.

Under Biden’s plan, eligible individual borrowers who earned less than $125,000 in either 2020 or 2021, and married couples or heads of households who earned less than $250,000 annually in those years, would see up to $10,000 of their federal student loan debt forgiven.

If an eligible borrower also received a federal Pell grant while enrolled in college, the person is eligible for up to $20,000 in debt forgiveness.

This story has been updated with additional details on Friday.

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