5 facts you should know about the student loan forgiveness lockout
Are you a borrower and don't know what your next steps should be regarding your student debt? Here is a summary of the latest information on the subject.
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After a federal judge in Texas ruled Thursday that the student loan forgiveness plan is illegal, President Joe Biden's administration had to shut down the student loan forgiveness application that was available on the Federal Student Aid website. As a result, many borrowers wonder what will happen to their debts. But the reality is that there is no concrete answer and it could take months for the court to decide.
To clear up some of the doubts that remain unanswered, here are 5 facts you should know after the Biden Administration closed its students' loan forgiveness application:
- The Department of Justice immediately appealed the decision to the 5th U.S. Circuit Court of Appeals. However, that same court had already temporarily blocked the forgiveness plan in recent weeks.
- The lawsuits against Biden's debt forgiveness plan argue that the president lacks the authority to grant blanket forgiveness to borrowers.
- According to a CNN article, the Justice Department could also ask for an emergency stay of the Texas judge's order. If granted - and if another appeals court ends its temporary stay of the program in a separate, pending case - the administration could cancel the debt before the 5th Circuit issues a final ruling. | But the Department of Justice could also ask for an emergency stay of the Texas judge’s order. If granted – and if a different appeals court ends its temporary stay on the program in a separate, pending case – the administration could cancel the debt before the 5th Circuit issues a final ruling.
- The Biden administration has until January to cancel student debt to qualifying borrowers, depending on the final court decision.
- In the meantime... borrowers can subscribe to updates from the Department of Education and keep an eye on the Federal Student Aid website.
For more information, we share the following articles in the Times magazine and on CNN's website that summarize very well the current situation regarding the blocking of the loan forgiveness application.