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What's up with Biden's student loan forgiveness program?

2022-11-03T22:35:59.544Z


President Joe Biden's student loan forgiveness program remains on hold as a federal appeals court weighs a legal challenge brought by six GOP-led states.


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Washington (CNN) --

President Joe Biden's student loan forgiveness program remains suspended as a federal appeals court weighs a legal challenge brought by six GOP-led states.


Are applications being accepted?

The Biden administration continues to accept applications for student loan forgiveness, amounting to a maximum of $20,000 per borrower, but is currently not authorized to cancel the debts due to a temporary administrative stay that the US 8th Circuit Court of Appeals The US imposed on the program on October 21.

Now, the appeals court will decide whether to grant an injunction requested by the states.

If so, the student loan forgiveness program could be put on hold while the litigation continues and the court hears both sides on the merits of the case.

If the precautionary measure is not granted, the cancellation of the debt could begin while the appeal is resolved.

The ruling on the preliminary requirement could come at any time.

A trial judge dismissed the lawsuit on October 20, ruling that the states did not have the legal capacity to bring the action.

Supreme Court Judge Amy Coney Barrett also rejected another challenge to Biden's student loan forgiveness program, refusing to accept an injunction filed by a group of Wisconsin taxpayers.

  • They ask the Supreme Court to block Biden's student loan forgiveness plan

Meanwhile, the Biden administration is also facing lawsuits from Arizona Republican Attorney General Mark Brnovich and conservative groups such as the Job Creators Network Foundation and the Cato Institute.

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Many of the lawsuits contend that the Biden administration lacks the legal authority to broadly write off student loan debt.

But government lawyers argue that Congress gave the secretary of education the power to forgive the debt in a 2003 law known as the HEROES Act.

Nearly 26 million people have so far applied for student loan forgiveness, the Biden administration reported Thursday.

The application opened on October 14.

The administration also said Thursday that 16 million loan forgiveness applications could be approved this week.

But borrowers shouldn't expect to see their debts canceled until the appeals court lifts the stay on the program.

How can borrowers apply for student loan forgiveness?

Borrowers can apply online here: https://studentaid.gov/debt-relief/application.

Applicants will receive an email confirmation once their application has been successfully submitted.

They will then be notified by their loan servicer if and when debt cancellation has been applied to their account.

Borrowers have until December 31, 2023 to apply.

If the court authorizes student loan forgiveness, an estimated 8 million eligible borrowers could automatically receive debt discharge because the Department of Education already has their income information on file.

Those borrowers could start seeing their debt canceled on Nov. 15, at the earliest, if there isn't a legal pause at that time.

Who is eligible for student loan forgiveness?

If Biden's program is allowed to go ahead, individual borrowers who made less than $125,000 in 2020 or 2021 and married couples or heads of households who made less than $250,000 a year in those years could receive up to $250,000 in forgiveness. $10,000 of your federal debt.

If a qualified borrower also received a Federal Pell Grant while enrolled in college, the individual is eligible for up to $20,000 of forgiveness.

  • Pell Grants in the US: what they are, who is eligible, requirements, how much they pay and how to apply

There are a variety of federal student loans, and not all are eligible for the measure.

Federal Direct Loans, including subsidized loans, unsubsidized loans, parent PLUS loans, and graduate PLUS loans are eligible.

But federal student loans that are guaranteed by the government but held by private lenders are not eligible unless the borrower has applied to consolidate those loans into a Direct Loan before September 29.

student loans

Source: cnnespanol

All news articles on 2022-11-03

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