Two federal judges in Kansas and Missouri have issued rulings that block significant portions of a Biden administration student loan repayment plan. The plan aimed to provide a faster path to loan cancellation and lower monthly payments for millions of borrowers.
In Kansas, U.S. District Judge Daniel Crabtree's ruling, in response to a lawsuit filed by the state's attorney general, allows for the forgiveness of loans under $12,000 after 10 years of payments. However, parts of the program intended to assist borrowers with larger loans by reducing monthly payments and required payment periods were halted.
In Missouri, U.S. District Judge John Ross issued an order preventing the forgiveness of loan balances but allowing for lower monthly payments. Both judges, appointed by former President Barack Obama, cited that the Education Secretary exceeded the authority granted by Congress in laws related to student loans.
The White House expressed disagreement with the rulings and vowed to continue defending the program to provide relief to borrowers. Critics of the plan, including Republican officials, argue that loan forgiveness shifts the burden to taxpayers.
The Student Borrower Protection Center criticized the decisions as partisan and causing confusion among borrowers. The rulings are preliminary injunctions that will remain in effect until trial.
While the lawsuits sought to invalidate the entire program, the judges noted that the states did not file the suits until late March and early April, respectively. The decisions impact millions of borrowers who may now face uncertainty regarding their loan repayment options.
Both judges emphasized that the Biden administration's plan overreached the authority granted by Congress in dealing with student loans. The rulings have implications for borrowers in several states, with ongoing legal battles expected to determine the fate of the program.
