A legal battle between the Biden administration and six conservative states has paused a recently launched student loan forgiveness program. Even so, administration officials remain adamant about encouraging Americans from different walks to submit applications online.
On Monday evening, U.S. Education Secretary Miguel Cardona attempted to lay to rest any notion that some segments of the population wouldn’t be able to benefit from the Biden administration’s latest advancement in student loan debt relief.
He said that borrowers, regardless of whether they’ve finished college, defaulted on their loans, took out Pell Grants or received Parent PLUS loans, remain eligible to secure up to $20,000 in student loan debt relief.
Since the Biden administration made this announcement last week, more than half of 40 million eligible borrowers have applied. Qualified applicants must make less than $125,000 individually or $250,000 as a household.
The Biden administration’s latest action comes amid contentious midterm races and recent court battles in which a group of conservative states — Arkansas, Iowa, Kansas, Missouri, Nebraska and South Carolina — have called the administration’s student loan relief program an example of executive overreach.
After a federal court judge in Missouri dismissed the case, the group turned to the Eighth Circuit Court of Appeals, which then granted a stay.
The Biden administration has since released a statement saying that the states have failed to prove they would be adversely affected by student loan debt relief. During an appearance before the Democratic National Committee event on Monday, President Joe Biden (D) doubled down on this message.
This ongoing lawsuit counts among several that have been filed against the federal government. Over the last few weeks, other conservative groups have targeted the Federal Family Education Loan, commercially-held loans backed by the federal government. Up until Sept. 29, when the Biden administration discontinued the practice, FFEL borrowers were able to consolidate those loans into balances owed to the Department of Education.
The states currently embroiled in the lawsuit have a substantial number of FFEL borrowers. They’ve argued that the Biden administration’s move would encourage borrowers to look exclusively at federal loans. The federal government has denied that notion, saying it amended portions of the plan so borrowers in the six states wouldn’t ditch FFEL.
The Biden administration estimates that nearly 2.8 million borrowers live in the six states involved in the lawsuit. With the ongoing lawsuit, neither they nor millions of other eligible borrowers will be able to start the loan forgiveness process.
As Cardona said on Monday evening, however, that shouldn’t stop people from putting in their bid for debt relief.
“It was a big deal for the Biden administration and Department of Education last week,” he said. “Forty million borrowers are now eligible for up to $20,000 in debt relief. As we wait for things to play out in the courts, we have to focus on what matters. Anyone with student loans of less than $125,000 should apply. Let’s make sure [people] know help is finally here.”