Appeals courts blocks Biden student-debt relief plan

An appeals court ruled on Tuesday to block former President Biden’s Saving on Valuable Education (SAVE) income-driven repayment plan that lowered monthly payments for some borrowers and quickened the pace of student debt relief for others.  

The 8th U.S. Circuit Court of Appeals ruled in favor of seven Republican-led states that argue the Department of Education under Biden exceeded its authority with the implementation of SAVE. 

U.S. Circuit Judge L. Steven Grasz said in the decision the authority given to the Education secretary was to “to create repayment plans means the Secretary must design ICR plans leading to actual repayment of the loans.”  

“The Secretary has gone well beyond this authority by designing a plan where loans are largely forgiven rather than repaid,” Grasz wrote in a decision supported by two other Republican-appointed judges on the case.  

The SAVE plan was implemented after the Supreme Court blocked Biden’s efforts to give partial universal student debt forgiveness. 

The SAVE plan lowered some borrowers’ payments to $0 a month and made it so others with lower student loan balances could receive debt relief after only 10 years, a significant drop from the 20 to 25 years it took to receive relief before.  

“Though @JoeBiden is out of office, this precedent is imperative to ensuring a President cannot force working Americans to foot the bill for someone else's Ivy League debt,” said Missouri Attorney General Andrew Bailey, one of the states in the lawsuit. “HUGE win.” 

The decision comes as student loan advocates fear President Trump would aim to roll back steps Biden took to give student loan borrowers more relief, especially on issues that were still held up in the courts.