Republican Led Resolution to End Loan Forgiveness Passed
A resolution to cancel The Biden Administration’s Student Loan Forgiveness Plan passed both the House and Senate this week. President Biden has promised to veto it which will stand since it would take a super majority to override the veto and there aren’t enough votes for that to happen.
As a reminder, the plan would cancel up to $20,000 in federal student loan debt for 10’s of millions of Americans. The plan has been blocked by two lower federal courts following legal challenges last Fall. The Supreme Court took up the case and held a hearing last February. A majority of the justices appeared to express skepticism during questioning that such an executive order was a proper exercise of executive authority. A decision is expected by early July.
Federal Student Loan Payment Resumption
The debt ceiling deal hasn’t changed much about the current loan landscape.
As part of the bill, borrowers will have to begin making payments again after August 29. That is also the date their loans will again accrue interest. The bill prohibits the education secretary from making extensions without congressional approval. The restart will affect some 43 million borrowers who, collectively, owe over a trillion in student loan debt.
Back in November, the Biden administration said it was planning to end the pause at the end of August, or, at the latest, 60 days after the Supreme Court rules on Biden’s broader student debt relief plan.
Bottomline
Don’t expect any additional relief with regard to easing the burden of student loan debt anytime soon. Conservatives remain staunchly opposed to any further relief and odds are that the Supreme Court will shoot down Biden’s Student Loan Forgiveness Plan in the coming weeks.
