Supreme Court decides TODAY fate of Biden’s $400 billion student loan forgiveness plan: Millions wait for judges to rule on controversial plan
- Biden plan forgives debts up to $10,000 for borrowers earning less than $125,000
- Americans with Pell Grants would also be forgiven up to $20,000
- Republican states believe Biden should have sought approval from Congress
The Supreme Court today will decide the fate of President Joe Biden’s $400 billion student loan bailout.
Millions anxiously await the judges’ ruling on the White House’s controversial plan to forgive up to $10,000 in loans for borrowers earning less than $125,000 and up to $20,000 for those with Pell Grants.
The landmark decision comes just 24 hours after bank-governed colleges could no longer use race as a factor in admissions.
The student loan decision will affect up to 26 million Americans who have not had to repay their loans in three and a half years due to a COVID pandemic freeze.
The Supreme Court today decides the fate of President Joe Biden’s $400 million student loan bailout
Millions anxiously await the judges’ ruling on the White House’s controversial plan to forgive up to $10,000 in loans for borrowers earning less than $125,000 and up to $20,000 for those with Pell Grants
Borrowers will have to resume their payments in October and interest will begin to accrue in September.
For months, Biden’s blueprint for student loans has been at the center of a legal battle involving six Republican-controlled US states.
Iowa, Arkansas, Kansas, Missouri, Nebraska and South Carolina said he had no legal authority to proceed with the plan without Congressional approval first.
The program has been suspended since November after a federal appeals court in St. Louis issued an injunction suspending applications and disbursements.
That forced the US government to seek intervention from judges in the Supreme Court, which has a conservative majority of 6 to 3.
The judges already seemed skeptical about the future of the plan.
Announced last August, the government promised to forgive about $10,000 in federal student debt for students earning less than $125,000.
Officials also pledged to contribute an additional $10,000 for students who received so-called Pell Grants.
These financial aid payments are awarded to students with exceptional financial needs.
But most Republicans say those who took out loans should pay them back without bailouts.
They have also argued that taxes paid by Americans who did not attend college should not be used to fund those who did.
The court’s 6-3 conservative majority already seemed skeptical about upholding the plan
Borrowers will have to resume their payments in October and interest will begin to accrue in September
Donald Trump froze student loan payments in March 2020 as Covid-19 spread worldwide.
They will start again at the end of August as part of the recent debt ceiling agreement between the administration and Congress.
Last week, the US Senate passed a motion to withdraw Biden’s loan forgiveness plan, but the president has already said he will veto it.
According to the Ministry of Education, more than 26 million people have already signed up for the program, with as many as 16 million provisionally approved for debt relief.
Student debt is the second largest form of consumer debt in the US, behind mortgages and other home loans.
rural, 45 million Americans owe $1.6 trillion in borrowed money they used to pay for their college education.