The Supreme Court puts Biden's student loan relief program on ice for now
A MARTÍNEZ, HOST:
The legal fight over President Biden's student loan relief program has put a lot of borrowers in limbo. And now the Supreme Court is going to have its say.
RACHEL MARTIN, HOST:
Yeah. The court announced Thursday that it will hear arguments about the president's plan. They're going to do so in February. That will prolong the uncertainty for borrowers, who are anxious to see how much of their loans might be written off, if at all. NPR's Elissa Nadworny has been covering all this and joins us this morning. Hey, Elissa.
ELISSA NADWORNY, BYLINE: Good morning.
MARTIN: All right. Give us the particulars of what the court decided yesterday.
NADWORNY: So the Supreme Court is going to hear a case filed just a few months ago by six Republican-led states claiming the state's loan authorities are going to be harmed by Biden's relief program. The court order is something of a blow to the Biden administration because in the context of this case, the administration had petitioned the Supreme Court to allow them to begin canceling student loan debts even while these various legal challenges were considered in the lower courts. But when the Supreme Court said, yep, we'll hear the case, it also said the administration will have to keep the loan cancellation program on hold. So borrowers aren't going to see their balances go down. Biden's plan, which relieves up to $20,000 in federal student loans for many low- to middle-income borrowers, has faced a number of legal challenges.
MARTIN: Yeah, so let's talk about those because there have been several.
NADWORNY: Yup. And there's been a lot of confusion about, is this all legal? And that's perhaps the biggest reason that the Supreme Court decided to step in and hear the arguments this term. I talked to law professor Luke Herrine at the University of Alabama, who said he wasn't surprised it went to the Supreme Court.
LUKE HERRINE: I think the legal issue is important and difficult enough that it was likely that the Supreme Court would take it up.
NADWORNY: Herrine says the court is going to weigh two things - the legality of the debt relief program and the idea of overreach. So does the Biden administration, does the Education Department have the power to do this?
MARTIN: Right. And that's the central question. That's what Republicans are arguing - that the administration does not have that power.
MARTIN: So let's just talk about the borrowers, who are really at the center of this. I mean, you nodded to it earlier. They're just going to have to sit and wait, right?
NADWORNY: Yeah, that's right. It's going to keep borrowers in limbo a bit longer. So nearly 26 million borrowers have applied for some debt to be erased. Sixteen million borrowers have actually had their applications already approved. Madison Mariles, who's a grad student outside Detroit, is one of them.
MADISON MARILES: You get to the point where, OK, we're going to do it and then have it ripped away again. It's like, OK, well, I don't know if this is actually going to happen. OK, now you're just kind of, like, jerking me around. Like, is it happening, or is it not? Like, what is going on?
NADWORNY: So federal borrowers haven't had to make monthly loan payments more or less since the pandemic started back in 2020. But with the debt relief plan in doubt, some borrowers don't know how much they'll need to plan to repay. Sydney Grullon-Matos has $28,000 in debt. She should qualify for up to $20,000 in relief because she was a Pell Grant recipient. But now she's sitting here wondering, will she owe back the whole thing or just 8,000?
MARTIN: It's just the waiting game of finding out exactly how much I have to pay off. I just - yeah, I just want to know. Just tell me how much money I'm going to be paying off.
NADWORNY: As it stands now, borrowers will have to start making monthly payments again 60 days after a legal decision or 60 days after June 30, 2023. So it's kind of whatever happens first.
MARTIN: Oh, man, it's tough for those people. NPR's Elissa Nadworny. Elissa, thanks for all your reporting on this. We appreciate it.
NADWORNY: You bet.
(SOUNDBITE OF KIEFER'S "SOCIALLY AWKWARD") Transcript provided by NPR, Copyright NPR.