SCOTUS ruled that student loan forgiveness is dead

 If you were looking forward to this it's over, if nothing else the Biden Administration needs to come up with a new plan. From the New York Post.

The Supreme Court ruled Friday that President Biden’s controversial program to forgive student loan debt for roughly 40 million borrowers exceeded his executive authority.

On the last day before the high court’s summer recess, the six conservative justices ruled the $400 billion plan could not use an earlier 2003 law meant to help veterans of the Iraq and Afghanistan wars to implement the program.

The other three liberal justices dissented against the ruling.

Biden last August announced his student loan forgiveness plan, which aimed to cancel up to $20,000 in student loan debt for certain borrowers.

But the program was met with fierce resistance from many GOP lawmakers who questioned its legality.

If you borrowed federal student loans you could get up to $10,000 forgiven if you meet certain income guidelines. You could also get up to $20,000 if you used Pell Grants to attend a university.

h/t Newsalert

If you want to read the opinion itself, I found it via SCOTUSBlog.

CNBC: Will SCOTUS strike down President Biden's student debt plan?

 

[VIDEO] As you may know Biden's student loan forgiveness plan was challenged in the courts and it has made it up to the highest court in the United States. Will the Supreme Court of the United States rule against or in favor of Biden's loan forgiveness?

Is this something that you're following?

Politico: Supreme Court agrees to decide fate of Biden’s student debt relief

 If you're still concerned about the Biden admin's student debt relief which got suspended due to court challenges, the Supreme Court will resolve this at some point. Via Politico:

The court on Thursday deferred a ruling on the administration’s emergency request to immediately reinstate its debt relief program. Instead, the court said, the justices will hear arguments on the matter next year.

The case will “be argued in the February 2023 argument session,” the court said in a one-page order. No justice noted any dissent to the court’s decision not to immediately grant the Biden administration’s application to move forward with the debt relief program now.

Putting the case on the docket for the current court term means a decision is likely by June, if not earlier.

The Supreme Court’s decision to fast-track arguments about the legality of Biden’s debt relief plan comes just several months after he first announced it in August following months of pressure from progressives. Conservative groups and Republican state officials have filed a wave of legal challenges to stop Biden’s debt relief.

Meanwhile, get those loans paid off. Uncle Sam isn't coming to your rescue.

Oh yeah, bear in mind the Biden admin has again put federal student loan payments on pause through June 2023.

Also from Politico:

The Supreme Court said it would address two questions: whether the Republican attorneys general have standing to bring the case in the first place and “whether the plan exceeds the Secretary’s statutory authority or is arbitrary and capricious.”

Student loan payment pause extended thru June 2023

 

[VIDEO] Via CBS Miami. If you have federal student loans there is yet another pause in restarting payments through June 2023. Originally you would have to start making payments to federal student loans in January 2023.

This is one consequence of the student loan forgiveness which was blocked by a federal court ruling. $10K was to be forgiven up to $20K was forgiven if you held a pell grant.

Also of note the federal student loan repayment was paused during the coronavirus pandemic starting in 2020 and since Joe Biden had become President in 2021 the pause had been occasionally extended.

President Biden's student loan forgiveness plan blocked

 

[VIDEO] A federal judge in Texas blocked Biden's recent student loan forgiveness plan because it was said to be beyond the authority of the US Dept. of Education and the federal gov't executive branch. Also in a separate case filed in St. Louis, Missouri it only put on hold the execution of Pres. Biden's student loan forgiveness although those who wished to apply still could.

As of now student loan forgiveness applications are currently on hold.

Forbes: Biden Student Loan Forgiveness Plan Survives Multiple Court Challenges — But Legal Battles Continue

 Sorry I have been slow about this, however, there was bound to be legal challenges to the Biden admin's proposed student loan forgiveness program.

Forbes: 

Ramsey: Reaction to student loan forgiveness

 

[VIDEO] I've been sharing videos of personal finance guru Dave Ramsey over the course of the last few weeks. Ramsey and Rachel Cruze are talking about yesterday's news with regards to Biden's action on student loan forgiveness. I knew he'd have something to say.

Ramsey's deal is he wants individuals to be debt free so he might be happy in those cases. However, he goes into a rant about how this is all about politics. He might also mention the debt and how you and your grandchildren will continue to pay for this debt.

Of course let's add this in the Biden-Harris admin is a failed economic presidency!

The Biden-Harris Administration's Student Debt Relief Plan Explained

 This is a link to a federal gov't about the latest effort by the "Biden-Harris" administration with regards to student loans. As you saw earlier you can have up to $20K of your student loans forgiven - $20K is if you have Federal Pell Grants, $10 for those who never held Pell Grants. This relief are for those borrowers who's income is less than $125K/year or couples who's income is less than $250K/year.

Anyway a lot more information to inform you of gov't action on this issue.

There has been a pause on Federal gov't student loans since 2020 which was the start of the pandemic scheduled to end in January 2023. So as far as whether or not you're eligible for this relief this is from the link to studentaid.gov:

What do I need to do in order to receive loan forgiveness?

• Nearly 8 million borrowers may be eligible to receive relief automatically because relevant income data is already available to the U.S. Department of Education.
• If the U.S. Department of Education doesn't have your income data - or if you don't know if the U.S. Department of Education has your income data, the Administration will launch a simple application in the coming weeks.
• The application will be available before the pause on federal student loan repayments ends on December 31st.
• If you would like to be notified by the U.S. Department of Education when the application is open, please sign up at the Department of Education subscription page.

Hopefully this will be needed relief if this affects you.

CNBC: Pres. Biden cancels $10K of student loan debt for most borrowers

 Well it's not total relief, but how many will argue with this. I won't.

Via CNBC:

President Joe Biden announced Wednesday that he will forgive $10,000 in federal student debt for most borrowers, fulfilling a campaign pledge and delivering financial relief to millions of Americans.

Biden will cancel up to $20,000 for recipients of Pell Grants, he also said in a tweet Wednesday.

The relief will be limited to Americans earning under $125,000 per year, or $250,000 for married couples or heads of households. The relief is also capped at the amount of a borrower’s outstanding eligible debt, per the Education Department.

The president will also extend the payment pause on most federal student loans “one final time” through Dec. 31, 2022, according to the tweet.

The tweet in question.

Prager U: Student loan forgiveness scam

 

[VIDEO] Inez Stepman from Prager U discusses student loan forgiveness and why it's a scam.

You're going to hear the term cui bono - or to whom it benefits - a lot in this video. Student loans benefits for example the universities because it enables them to hire more administrators or construct more buildings on campus. Student loan forgiveness though perhaps takes a load off of those low earning and impoverished college graduates could actually benefit the wealthy more.

Student loans: Biden extends payment pause through August 31

[VIDEO] I'm sharing this clip from The Ramsey Show to share this news about the latest student loan extension by the Biden administration.

Via Yahoo News:

The Biden administration will officially enact another extension of the pandemic payment pause related to federally-backed student loans through the end of August.

In a statement, President Biden stated that "my Administration is extending the pause on federal student loan repayments through August 31st, 2022. That additional time will assist borrowers in achieving greater financial security and support the Department of Education’s efforts to continue improving student loan programs. As part of this transition, the Department of Education will offer additional flexibilities and support for all borrowers."

The pause was set to expire after May 1 after being enacted by former President Donald Trump amid the coronavirus pandemic in March 2020 and extended multiple times by President Biden.

“The Department of Education is committed to ensuring that student loan borrowers have a smooth transition back to repayment," Secretary of Education Miguel Cardona said in the press release.

So back to the video this person who called in got a nice bonus and enabled him to pay off the remainder of his student loans. Some friends were giving him a hard time over him just paying them off instead of waiting for this extension. To which I say if you're able to just pay them off and write one big check, I envy him. He's free and I'm still trying to figure it out and so are his friends evidently.... 

Navient settlement

 I wanted to share this story when I first heard about it since this blog has a few posts about student loan debt. 

From the Delaware News Journal:

Thousands of people with student loan debt will have their debt canceled or receive a one-time check as part of a multistate settlement with one of the nation's largest student loan servicers.

Navient, the Wilmington-based company, was accused of encouraging borrowers to pause payments through forbearance rather than directing them to lower-cost repayment plans tied to their income. Although Navient denies the charges, the settlement ends probes by multiple states into the company's practices and will affect thousands of people whose loans are serviced by Navient.

The loans in question were mostly originated by Sallie Mae between 2002 and 2014 before Sallie Mae spun off its student loan services as Navient in 2014. The agreement will result in the cancellation of $1.7 billion in student loans. Another $95 million will be distributed in restitution payments worth about $260.

How do I find out if I will benefit?

Those who will have private loan debt canceled will be notified by Navient no later than July. They will receive a refund for payments made after June 30, 2021.

Borrowers who are eligible for the $260 restitution payment will receive a postcard from a settlement administrator this spring.

With this said if you're currently making payments continue to do so, especially if there is a possibility that you might not be eligible for the student loan cancellation. At the very least wait until you get official notification by Navient.

If you want more information I would suggest going to https://www.navientagsettlement.com/  to find out as much info as possible. The Attorney General of Illinois was one of four state Attorney Generals who led this settlement. And of course 35 other states are party to this settlement.

From that website:

Under the terms of the settlement, Navient will cancel the remaining balance on $1.7 billion in subprime private student loan balances owed by more than 66,000 borrowers nationwide. In addition, Navient will pay $142.5 million to the attorneys general. A total of $95 million in restitution payments of about $260 each will be distributed to approximately 350,000 federal loan borrowers who were placed in certain types of long-term forbearances. Borrowers who will receive restitution or debt cancellation span all generations: Navient’s harmful conduct impacted everyone from students who enrolled in colleges and universities immediately after high school to mid-career students who dropped out after enrolling in a for-profit school in the early to mid-2000s.

As stated you will be notified of whatever resolution to your debt that you are due.