Biden’s student loan forgiveness plan has been blocked again
Not even a full day after a narrow victory was announced for the Biden administration’s student loan forgiveness plan, a Missouri judge issued an injunction against the plan, putting it back on pause.
The Biden administration’s second attempt at widespread student loan forgiveness, often called “Plan B” by student loan experts, was first stayed by a federal court in Georgia in September. The temporary blockade was due to end this week.
On Wednesday, U.S. District Judge Randal Hall ruled that the state of Georgia had failed to show that the plan would harm the state. The judge decided to transfer the case to Missouri and allow the restraining order against the debt relief plan to expire.
After the decision, Elaine Rubin, a student loan and policy expert at Edvisors, told CNET that the decision did not mean the forgiveness plan was safe. Hours after the blockade was lifted Thursday, officials from Republican-led states, including Missouri Attorney General Andrew Bailey, began petitioning a Missouri judge to block the plan.
On Thursday evening, U.S. District Judge Matthew Schelp issued a preliminary injunction against the debt relief plan. Bailey released a statement Thursday in support of Judge Schlep’s decision.
What does this mean for borrowers? First, know that the ban is temporary until the court makes a final decision. For now, this means the Ministry of Education cannot grant debt forgiveness under its latest plan. If the plan holds up in court, it is expected to provide student debt relief to an estimated 25 million Americans.
With the fate of student loan debt relief programs uncertain, Rubin suggests borrowers start preparing for all repayment scenarios. “Borrowers should not make decisions based on the expectation of forgiveness,” she said. “Even if forgiveness is approved, not all borrowers will qualify for forgiveness.”
The Ministry of Education did not immediately respond to a request for comment. We’ll keep you posted as this story unfolds.
