Biden administration's plan

In court, the Biden administration’s plan to help people with student loan debt got another setback

Biden administration’s plan: A second federal appeals court has denied a petition by the Biden administration to stay a verdict suspending the President’s strategy on student debt relief. The 5th US Circuit Court of Appeals ruled Wednesday night that it would not pause a ruling from a Texas judge striking down the policy while an appeal of the ruling played out.

This action paves the way for the US Department of Justice to appeal the case to the US Supreme Court, which is already considering a separate request from the Biden administration that it reverse an order from the 8th US Circuit Court of Appeals halting the loan forgiveness program.

A panel composed of George W. Bush appointees, Barack Obama appointees, and Donald Trump appointees issued the 5th Circuit denial. They did not explain why they denied the administration’s motion, but the panel ordered the complete appeal to be expedited.

Nearly two weeks ago, the Biden administration began notifying individuals who have been approved for federal student loan relief, despite the uncertainty surrounding the future of this relief due to the nationwide blockage of the program by lower courts. The US Department of Education confirmed in correspondence to debtors that subsequent legal battles have prevented the government from dismissing the debt.

Biden administration's plan

Millions of qualified debtors would receive up to $20,000 in debt relief through Biden’s program. It has generated criticism, particularly from Republicans, and legal challenges. The 10 November Texas verdict confirmed by the court of appeals on Wednesday ruled Biden’s scheme to be unlawful. Consequently, the Education Department ceased accepting petitions for loan relief. Prior to the latest court decisions, over 26 million people filed for student loan relief, with 16 million of those applications being approved, according to the Biden administration.

In January, federal student loan payments that were suspended during the Covid-19 pandemic were scheduled to resume. However, the Biden administration extended the pause period once more as legal battles continued.

The payment suspension will continue until sixty days after the conclusion of the litigation. If the program has not been implemented and the litigation has not been resolved by June 30, according to the Department of Education, payments will resume 60 days later.

“I’m completely confident my plan is legal,” said President Joe Biden in a video posted on Twitter last week, referencing his student loan forgiveness program. “But it isn’t fair to ask tens of millions of borrowers eligible for relief to resume their student debt payments while the courts consider the lawsuit,” he added.

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