President Joe Biden announced on Tuesday (Nov. 22) that his administration will extend the pause on federal student loan repayments while the courts decide the fate of his federal student loan forgiveness program.
“I'm confident that our student debt relief plan is legal. But it’s on hold because Republican officials want to block it,” Biden said in his tweeted video announcement.
Biden added, “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.”
The Washington Post reports that payments will resume 60 days after the education department is allowed to implement the program or the litigation is resolved. If that hasn’t happened by June 30, payments will resume 60 days later or on Sept. 1.
In August, Biden announced a plan to cancel up to $20,000 in debt per eligible borrower. But it almost immediately faced legal challenges.
The Eighth U.S. Circuit Court of Appeals put the program on hold in October while it considered a lawsuit brought by six states challenging the program and the president's authority to enact it. And earlier this month, a federal district judge ruled that the administration lacks the authority to wipe out student loan debt, siding with a conservative advocacy group that sued to halt the plan.
The administration asked the U.S. Supreme Court on Friday (Nov. 18) to reinstate the debt forgiveness plan, arguing that the education secretary has the constitutional authority to create the program.
Biden said the June 30 deadline would give the high court enough time to hear the case in its current term.
According to NBC News, roughly 45 million people have student loan debt, but the repayment moratorium does not apply to borrowers with privately held loans. Borrowers owed more than $1.7 trillion in student loans in the third quarter of 2022.