U.S. Appeals Court Temporarily Blocks Biden’s Massive Student Loan Handout

The 8th U.S. Circuit Court of Appeals recently granted a motion to temporarily block President Joe Biden’s estimated $500 billion student loan handout plan. The court ruled in favor of six states led by Republicans who requested the president’s plan be halted while the court works through its injunction request.

President Biden’s plan aims to cancel up to $10,000 for borrowers who took out federal student loans and up to $20,000 in student loan debt for borrowers who took out Pell Grants to fund their college education. Borrowers must qualify for the handout by having an adjusted gross income of less than $125,000 individually or less than $250,000 if married.

The appeals court decision comes just days after the administration released the online application for the handout. The president said the application portal took in over eight million applications during its testing period without any issues. 

Administration plans to move “full speed ahead” despite ruling

In response to the appeals court decision, White House Press Secretary Karine Jean-Pierre said the administration would continue to move “full speed ahead” in its preparations while complying with an appeals court order. 

“We will continue to move full speed ahead in our preparations in compliance with this order. And, the administration will continue to fight Republican officials suing to block our efforts to provide relief to working families,” said Jean-Pierre. “Tonight’s temporary order does not prevent borrowers from applying for student debt relief at studentaid.gov — and we encourage eligible borrowers to join the nearly 22 million Americans whose information the Department of Education already has. It also does not prevent us from reviewing these applications and preparing them for transmission to loan servicers.”

Jean-Pierre continued, “It is also important to note that the order does not reverse the trial court’s dismissal of the case or suggest that the case has merit. It merely prevents debt from being discharged until the court makes a decision.”

Biden continues to tout the loan handout, saying, “As millions of people fill out the application, we’re going to make sure the system continues to work as smoothly as possible so that we can deliver student loan relief for millions of Americans as quickly and as efficiently as possible.”

“Our student loan plan lowers costs for Americans as they recover from the pandemic to give everybody a little more breathing room. I want to be clear who’s going to benefit most working people. Middle-class folks,” Biden said. “More than 40 million Americans stand to benefit from this relief.”