The 8th U.S. Circuit Court of Appeals issued a stay on the administration’s Saving on a Valuable Education (SAVE) Plan after a lawsuit questioning the program’s legality were brought by seven states: Missouri, Arkansas, Florida, Georgia, North Dakota, Ohio, and Oklahoma. Under the SAVE Plan, eligible borrowers would see their payments on undergraduate loans cut in half. Those with both undergraduate and graduate loans would pay a weighted average of between 5 percent and 10 percent of their income, based on the original principal balances of their loans. Payments would be recalculated annually and adjusted based on updated income and family size. The lawsuit states that President Joe Biden “is unilaterally trying to impose an extraordinarily expensive and controversial policy that he could not get through Congress” by enacting the SAVE Plan. The legal filing added, “This latest attempt to sidestep the Constitution is only the most recent instance in a long but troubling pattern of the president relying on innocuous language from decades-old statutes to impose drastic, costly policy changes on the American people without their consent.” Last summer, the U.S. Supreme Court struck down a similar program proposed by the Biden administration. By a 6-3 vote, the Court ruled that Biden’s student loan forgiveness plan, which sought to cancel around $430 billion in student loan debt, was illegal. Missouri Attorney General Andrew Bailey celebrated the appeals court’s decision to grant the emergency motion to block the student loan plan, calling it a “HUGE win for every American who still believes in paying their own way.”On July 19, a federal appeals court blocked the Biden administration from implementing a student loan repayment plan that would have affected 8 million borrowers.
JUST IN: The Court granted our emergency motion to BLOCK Joe Biden’s entire illegal student loan plan, which would have saddled working Americans with half-a-trillion dollars in Ivy League debt.
HUGE win for every American who still believes in paying their own way.
— Attorney General Andrew Bailey (@AGAndrewBailey) July 18, 2024
Following the court’s decision, the Biden administration announced it would be pausing student loan payments for the eight million borrowers enrolled in the program.
“Borrowers enrolled in the SAVE plan will be placed in an interest-free forbearance while our administration continues to vigorously defend the SAVE plan in court,” Miguel Cardona, the secretary of education, said in a statement. “The Department will be providing regular updates to borrowers affected by these rulings in the coming days.”
