Judge Halts Biden Student Debt Plan Right After It Was Allowed to Proceed
Federal Judge Blocks Student Debt Cancellation Plan #
A federal judge in Missouri has temporarily halted a plan to cancel student debt, just one day after another judge had allowed it to proceed. This decision has cast uncertainty over a program that could potentially impact more than 27 million borrowers.
The ruling has impeded efforts to finalize the program before the current administration leaves office in January. It marks the latest obstacle in the administration’s attempts to fulfill a campaign promise of providing widespread student loan relief. Various legal challenges have hindered several programs, and this particular one has now been stopped twice.
The program in question aimed to cancel up to $20,000 in accrued interest on loans and forgive outstanding balances for borrowers who began repaying their loans decades ago, among other measures. It represents the largest component of the administration’s multifaceted approach to offer broad student debt cancellation following the Supreme Court’s rejection of an earlier plan.
A group of seven Republican-led states filed a lawsuit last month to block the plan. They argued that the Education Department had rushed to establish the groundwork for the program before its completion, and that the proposed debt cancellation could potentially harm states and federal loan servicers financially.
Initially, a U.S. District Court judge for the Southern District of Georgia temporarily blocked the program a month ago. However, the judge lifted the hold on Wednesday before transferring the case to Missouri, which was deemed a more appropriate venue.