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Monday, February 06, 2023

Biden’s student loan relief plan temporarily blocked

Borrowers can still apply while federal appeals court reviews case

The loan forgiveness plan will reduce or erase the debt of up to 43 million Americans, including select UF graduates, if the U.S. Supreme Court doesn’t block it.
The loan forgiveness plan will reduce or erase the debt of up to 43 million Americans, including select UF graduates, if the U.S. Supreme Court doesn’t block it.

Long-promised student relief is stuck in limbo for now, as a federal appeals court has put President Joe Biden’s plan on hold. 

The court temporarily halted the forgiveness plan, which would see some federal student loan borrowers receive up to $20,000 in relief, to consider a lawsuit that challenged the plan’s constitutionality. The White House can still review applications while the ban is in effect, and borrowers are still encouraged to apply. 

The block comes just a week after The White House opened the application in a beta testing period and days after it launched the official website. The application opened a few weeks after Biden announced new program eligibility guidelines, which put borrowers who didn’t consolidate private loans with a federal loan out of the running for relief.

Six GOP states — Arkansas, Iowa, Kansas, Missouri, Nebraska and South Carolina — filed a lawsuit against the Biden administration alleging executive overreach and potential harm against loan providers. A federal judge dismissed the case earlier this week, but an appeal from the case paused the program to let the court review. 

Biden announced the program in August. Per the plan, borrowers who make less than $125,000 annually and received a Pell Grant are eligible for up to $20,000 in relief, while borrowers who make less than $125,000 annually but didn't receive a Pell Grant are eligible for up to $10,000 in relief. 

The application portal will remain open through the pause, which has no clear end date. The court will either dismiss the case and reinstate the program, or it will issue an injunction to extend the pause and review the case further. 

Contact Heather at hbushman@alligator.org. Follow her on Twitter @hmb_1013.

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Heather Bushman

Heather Bushman is a fourth-year journalism and political science student and the enterprise elections reporter. She previously wrote and edited for the Avenue desk and reported for WUFT News. You can usually find her writing, listening to music or writing about listening to music. Ask her about synesthesia or her album tier list sometime.


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