Biden administration can move forward with student loan forgiveness, federal judge rules

Authored by cnbc.com and submitted by AmethystOrator

A federal judge will let expire a temporary restraining order against the Biden administration's sweeping new student loan forgiveness plan, which could deliver relief to tens of millions of Americans.

The plan could benefit as many as three in every four federal student loan holders, when combined with the administration's previous efforts, according to an estimate by the Center for American Progress.

U.S. District Judge Randal Hall in Georgia, appointed by Republican former President George W. Bush, delivered the win for the Biden administration late on Wednesday.

The ruling means President Joe Biden may move forward with his administration's student loan forgiveness plan, just weeks before the November election.

The development stems from a lawsuit against the aid package brought by seven GOP-led states. The states — Alabama, Arkansas, Florida, Georgia, Missouri, North Dakota and Ohio — said the U.S. Department of Education's new debt cancellation effort is illegal.

However, Hall found that Georgia lacked standing to sue against the relief plan, and could not be the venue for the case.

The judge directed the case to be transferred to Missouri, since the states claim Biden's plan would most harm student loan servicer Mohela, or the Missouri Higher Education Loan Authority.

On Thursday, the Republican-led states asked a federal judge in Missouri to decide if the plan will stay blocked.

KileyCW on October 3rd, 2024 at 23:40 UTC »

Glad some will get help, but they really need to fix the whole system. This is like a moment in time bandaid while kids are still signing predatory loans. They need to cap interest on student loans, make it entirely tax deductible, and find ways to lower tuition.

gubmintbacon on October 3rd, 2024 at 21:43 UTC »

Mine have been in administrative forbearance this whole time. If they could just keep that open ended (or at least through the holidays) that would be ideal.

AmethystOrator on October 3rd, 2024 at 20:24 UTC »

A federal judge will let expire a temporary restraining order against the Biden administration’s sweeping new student loan forgiveness plan, which could deliver relief to tens of millions of Americans.

The plan could benefit as many as three in every four federal student loan holders, when combined with the administration’s previous efforts, according to an estimate by the Center for American Progress.

U.S. District Judge Randal Hall in Georgia, appointed by Republican former President George W. Bush, delivered the win for the Biden administration late on Wednesday.

The judge directed the case to be transferred to Missouri, since the states claim Biden’s plan would most harm student loan servicer Mohela, or the Missouri Higher Education Loan Authority.

On Thursday, the Republican-led states asked a federal judge in Missouri to decide if the plan will stay blocked.

Biden’s plan would forgive student debt for four groups of borrowers: those who owe more than they originally took out; people who’ve been in repayment already for decades; students from schools with a low financial value; and those who qualify for loan forgiveness under an existing program, but haven’t applied for it yet.

tl;dr

Edit: As another user u/karivara pointed out, "St-Louis-based U.S. District Judge Matthew Schelp issued a new preliminary injunction against Biden’s relief plan".

"As a result of the order, the U.S. Department of Education is again barred from forgiving people’s student loans until Schelp has a chance to rule on the case".

New article with the current status: https://www.cnbc.com/2024/10/03/biden-student-loan-forgiveness-blocked-again-missouri.html