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Two federal judges have temporarily halted major parts of President Biden’s student loan repayment plan.
Let’s catch you up to speed:
The SAVE program, which has enrolled over 8 million borrowers and canceled more than $5.5 billion in debt for 400,000 individuals, is Biden’s primary student loan forgiveness initiative. However, the recent rulings freeze the program’s broader implementation and halt future loan forgiveness. The program will continue to operate but with significant limitations as the legal battles continue.
What the Judge in Kansas did:
In Kansas, Judge Michael Crabtree ruled that the Department of Education cannot fully implement the Saving on a Valuable Education (SAVE) program, which was set to reduce payments for borrowers with undergraduate debt from 10% to 5% of their income above the poverty line. Judge Crabtree argued that the department lacked explicit congressional authority for this part of the program. This decision followed a lawsuit led by Kansas Attorney General Kris Kobach, supported by 11 other Republican states.
What the Judge in Missouri did:
Meanwhile, Judge John Ross in Missouri blocked the Department of Education from forgiving loans under the SAVE plan, arguing it would illegally deprive state loan operators of revenue. Missouri Attorney General Andrew Bailey and five other states challenged the program, echoing the Supreme Court’s earlier stance against Biden’s broader loan forgiveness attempt. Bailey celebrated the ruling as a constitutional victory, emphasizing that Congress did not authorize such extensive debt relief.
Top Biden Administration official responds:
Education Secretary Miguel Cardona criticized the rulings. In a statement, he said, “The Biden-Harris Administration’s SAVE Plan is the most affordable repayment plan in history. But Republican elected officials and special interests sued to block their own constituents from being able to benefit from this plan – even though the Department has relied on the authority under the Higher Education Act three times over the last 30 years to implement income-driven repayment plans. We will continue to provide this long-overdue relief, no matter how many times Republican elected officials and their allies try to stop us.”
