Ed. Note: This story was updated on October 4, 2024.
The week began with the expiration of the grace period in place for late or missed student loan payments. A few days later, unexpected student loan news broke: The temporary restraining order that placed a pause on President Joe Biden’s new student loan forgiveness regulation was ended by a federal judge, clearing the path for its implementation. Things have changed again, as a Missouri judge placed a temporary injunction on the plan within a day of the expiration of the previous hold, meaning it is on pause yet again until the judge rules on the proposal.
One estimate, from the Center for American Progress, found the plan stands to benefit “as many as three in every four federal student loan holders, when combined with the administration’s previous efforts,” reported CNBC.
According to the Washington Post, a legal challenge brought by seven Republican-led states (Alabama, Arkansas, Florida, Georgia, Missouri, North Dakota and Ohio) argued that with the proposal, which the Biden administration says could benefit over 30 million borrowers, “the administration is exceeding its authority and illegally preparing to forgive loans before the rule is even in effect.”
U.S. District Judge J. Randal Hall ruled that the lawsuit was incorrectly filed in Georgia, transferring it to Missouri instead; the previous Supreme Court ruling on the Biden administration’s student loan cancelation efforts was regarding MOHELA, the Missouri Higher Education Loan Authority (MOHELA).
In a statement, a Department of Education spokesperson approved of the judge’s ruling that the case had “no legal basis to be brought in Georgia” and condemned the case as an attempt from the Republicans “to prevent millions of their own constituents from getting breathing room on their student loans.”
"The decision to file this case in the Brunswick Division of the Southern District of Georgia— a carefully chosen court with a single Republican-appointed judge—was a clear and desperate move to undermine democracy and stack the odds against working families," Persis Yu, deputy executive director and managing counsel at the Student Borrower Protection Center told Business Insider of the case.
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