Supreme Court again refuses to block Biden’s student loan relief plan

Amy Coney Barrett, Supreme Court nominee and United States Court of Appeals judge, on Capitol Hill in Washington, October 21, 2020.

Ken Cedeno | Reuters

The Supreme Court on Friday denied a second request to block the Biden administration’s student loan debt relief program.

Judge Amy Coney Barrett denied a emergency request to block the program carried by the Pacific Legal Foundation, a conservative legal group, on behalf of two Indiana borrowers. On October 20, Barrett rejected a similar request.

Barrett is responsible for these claims arising from cases before the United States Court of Appeals for the 7th Circuit, which includes Indiana.

The decision has little practical effect. For now, student loan relief remains suspended from a challenge contributed by six GOP-led states.

From the White House unveiled its loan relief plan in August to forgive $10,000 for most student borrowers and up to $20,000 for those who received Pell Grants for low-income families, he faced at least six lawsuits.

Nearly 26 million Americans have already applied for student loan forgiveness, and the Biden administration has approved 16 million of those applications, the White House announced Thursday. The administration has continued to encourage borrowers to seek relief despite recent challenges.

Caleb Kruckenberg, attorney at the Pacific Legal Foundation, said in an emailed statement: “We are disappointed with today’s denial, but we will continue to fight this program in court.”

“Virtually since this program was announced, the administration has sought to avoid judicial review,” Kruckenberg said. “So far they’ve been successful. But that doesn’t change the fact that this program is illegal through and through.”

“Stand up” remains an issue for forgiveness challenges

Experts say the main hurdle for those hoping to thwart the president’s action has been finding a plaintiff who can prove he was wronged by the policy.

“Such an injury is necessary to establish what the courts call ‘standing'”, Laurence Tribe, a Harvard law professor, recently told CNBC. “No individual, company or state is manifestly harmed as private lenders would have been if, for example, their student loans had been cancelled.”

With that in mind, Barrett’s decision to reject the Pacific Legal Foundation’s application is not surprising, said higher education expert Mark Kantrowitz.

“There were very few substantive differences between their original trial and the retrial, signifying a lack of legal status,” he said.

Student borrowers “in limbo”

As legal challenges mount, financial advisers say borrowers are wondering where student loan forgiveness stands.

“Court interference is really troubling because people are looking for certainty about what’s going on with their student loans,” said Ethan Miller, Certified Financial Planner and founder of Planning for Progress in the Washington, DC area. Miller specializes in clients with student loans.

“There was a plan that clearly outlined the steps,” he said. “And yet everyone was put in limbo.”

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