Student Loan Forgiveness On Again Off Again. Get Used to This Crap. More to Come.

The federal student loan forgiveness program, so many people were going to eliminate $10,000 to $20,000 of their federal student loan debt, was halted by a federal court judge.

You can follow Brown v. Department of Education for updates here.

But Here is the Kicker

Federal student loan payments are set to resume in January 2023. Many people were hoping for the Biden student loan forgiveness plan to eliminate the need to make or reduce payments.

Who knows how long this court case that has paused the forgiveness plan will take to resume it, if ever?

The Department of Education thinks this ruling sucks.

U.S. Secretary of Education Miguel Cardona said, “We believe strongly that the Biden-Harris Student Debt Relief Plan is lawful and necessary to give borrowers and working families breathing room as they recover from the pandemic and to ensure they succeed when repayment restarts.

“We are disappointed in the decision of the Texas court to block loan relief moving forward. Amidst efforts to block our debt relief program, we are not standing down. The Department of Justice has appealed today’s decision on our behalf, and we will continue to keep borrowers informed about our efforts to deliver targeted relief.

“More than 26 million borrowers have provided the information needed to process their applications for relief and 16 million applications have been approved and sent to loan servicers to be discharged when allowed by the courts.

Judge Mark Pittman saw things differently when it paused the forgiveness program and said it was unlawful.

The Judge concluded his ruling by saying, “This case involves the question of whether Congress—through the HEROES Act—gave the Secretary authority to implement a Program that provides debt forgiveness to millions of student-loan borrowers, totaling over $400 billion. Whether the Program constitutes good public policy is not the role of this Court to determine. Still, no one can plausibly deny that it is either one of the largest delegations of legislative power to the executive branch, or one of the largest exercises of legislative power without congressional authority in the history of the United States.

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In this country, we are not ruled by an all-powerful executive with a pen and a phone. Instead, we are ruled by a Constitution that provides for three distinct and independent branches of government. As President James Madison warned, “[t]he accumulation of all powers, legislative, executive, and judiciary, in the same hands, whether of one, a few, or many, and whether hereditary, self-appointed, or elective, may justly be pronounced the very definition of tyranny.” THE FEDERALIST NO. 47.

The Court is not blind to the current political division in our country. But it is fundamental to the survival of our Republic that the separation of powers as outlined in our Constitution be preserved. And having interpreted the HEROES Act, the Court holds that it does not provide “clear congressional authorization” for the Program proposed by the Secretary.” – Source

While the Judge was appointed by President Trump, he’s made a legitimate point about using the HEROES Act to forgive student loans. The better approach is to get Congress to change the law and allow all student loans to be treated like other debt in bankruptcy.

Until adult commonsense action on student loans, this will be an on-again-off-again mess with debtors bouncing in the middle.

Welcome to reality, have a nice day.

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Steve Rhode is the Get Out of Debt Guy and has been helping good people with bad debt problems since 1994. You can learn more about Steve, here.
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2 thoughts on “Student Loan Forgiveness On Again Off Again. Get Used to This Crap. More to Come.”

  1. If the Democrats retain control of the House, they can codify this as law during the lame duck session. It will be much more difficult for a court to overturn a law. And a judge who needs to reach back to James Madison, one of our least effective Presidents, to defend his position is standing on shaky ground, IMHO.


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