The Biden Administration’s Student Loan Relief Program and the Litigation by Eight States in the Post-COLVID-19 Correspondence

The Biden administration announced its student loan relief program in August, citing the the rising cost of attending college and the economic crisis brought on by the COVID-19 pandemic. The relief program is for low- and middle-income individuals, and includes up to $20,000 in debt cancellation for Pell Grant Recipients and up to $10,000 for non-Pell Grant recipient. The proposal for debt relief includes loan forgiveness and the reduction of monthly payments on undergraduate loans; it is just one part of the plan.

The Department of Education said it was assessing whether there were alternative pathways to help borrowers with private student loans who have not consolidated.

“Borrowers with privately held federal student loans who applied to consolidate their loans into Direct Loans before September 29, 2022 will obtain one-time debt relief. The FFEL program is now defunct and only a small percentage of borrowers have FFEL loans. This is a completely different program than Direct Loans,” the statement said.

The lawsuit was brought by eight states and Judge Autrey didn’t rule on the larger issue. He said that the states did not suffer the kind of injuries that gave them standing to be sued.

The HEROES Act: Reducing Borrowers’ Debt under the Closing of the National Emergency Plan for Student Loan Relief

The Biden administration has argued that Congress has given the secretary of education the power to broadly discharge student loan debt in a 2003 law known as the HEROES Act.

The White House spokesman said Republican officials in six states are fighting to stop relief for borrowers buried under mountains of debt.

“The President and his administration are lawfully giving working and middle class families breathing room as they recover from the pandemic and prepare to resume loan payments in January,” he said.

The Biden administration’s announcement came hours after a borrower sued, arguing that he would be forced to pay state taxes on the amount canceled – an expense he would otherwise avoid.

If you received a federal grant while you were in college, you are eligible for up to $20,000 of debt forgiveness. Each year millions of low income students are awarded grant money based on factors including family size and income and the cost of college. The borrowers are more likely to struggle to repay their debt.

The Congressional Budget Office estimated this week – before the administration excluded FFEL borrowers – that Biden’s plan could cost the government $400 billion but warned that the estimate relies on several assumptions and is “highly uncertain.”

Estimating the cost of student debt forgiveness is complicated because loans are generally paid back over several years. The White House argues that the CBO’s estimate should be looked at over a 30-year time frame.

The Heroes Act, which was enacted in the wake of the September 11 terrorist attacks, “provides the Secretary broad authority to grant relief from student loan requirements during specific periods,” including a war, other military operation or national emergency, according to the memo.

In October of this year, the Job Creators Network Foundation filed a lawsuit on behalf of two borrowers who did not apply for debt relief.

The staff attorney at the National Consumer Law Center previously told CNN that they think the Biden administration has strong legal authority and that it is not clear what legal standing would be needed to bring a case. A procedural threshold needs to be met in order to bring a case.

If the standing hurdle is cleared, a case would be heard by a district court first – which may or may not issue a preliminary injunction to prevent the cancellation from occurring before a final ruling is issued on the merits of the hypothetical case.

Several recent US Supreme Court decisions have talked about executive power, limiting the government’s authority to implement new rules. Lower courts may look over what the Supreme Court has said in cases that affect the Department of Education.

Biden’s Expansive Student Loan Forgiveness Program: Helping the Scammers to Become Richer, Richer and Smarter

The Biden administration is increasing its efforts to fight scams aimed at taking advantage of borrowers applying for its expansive student loan forgiveness plan, senior administration officials announced Wednesday.

The officials announced that the administration was working to combat scam and misinformation, including educating borrowers about how to protect themselves against scam.

The Department of Education thinks that the online application will be short. Submitting the application doesn’t require uploading any supporting documents and using your Federal Student Aid ID.

It said in an email to borrowers that they should not give their personal information or account passwords to anyone and should work with the US Department of Education and our loan servicers.

The administration urged borrowers to sign up to be notified when the application is available, to make sure their loan servicers have their current contact information and to report any scams they encounter to the FTC.

The Department of Education is warning borrowers of scams related to the student loan forgiveness program that ask for payment in return for help getting debt relief.

“This Biden forgiveness thing is Christmas, Thanksgiving and the Fourth of July all rolled into one for the scammers,” says Betsy Mayotte, the president of the Institute of Student Loan Advisors, a nonprofit that offers free counseling to borrowers.

The release they did today is a step in the right direction. “There’s only two things we can do as a community [to prevent fraud]. One is to educate borrowers and the other is enforcement.”

There are evil people who will be trying to use a program like this, that is trying to help people, and run their own scam to get money or personal.

“What we’re trying to do here is to give as much relief as possible to the hard working former students who deserve it,” Cordray said. “We’re moving at warp speed to get the application and the process going here.”

A Catch-22: Information on Forgiveness for Graduation Students and Parents Using Federal PLUS Loans, a Text from Wednesday’s Briefing

To avoid scam vulnerability, it’s important to release more specific information on when the forgiveness application will be and what it will look like.

There were no more details about when the application will be open or what the process will look like in Wednesday’s briefing.

“In one way, it’ll help,” she says. “But if I know the scammers, they’ll use that as an opportunity too: ‘The application’s out. You have to act fast. It’s just a short time. Now that the applications are out, let us help you to make sure you don’t miss it.’ So it’s a catch-22.”

Federal Direct Loans, also known as federal PLUS Loans, can be used for graduate students and parents if they meet the income requirements.

We will review your application, determine your eligibility for debt relief and work with your loan servicer to process your relief after you submit your application. The email stated that the department wouldcontact you if they needed any further information from you.

Taxing the Debt Discharged under Biden’s Plan: A Case Study of Arizona Attorney General Mark Brnovich and a U.S. Attorney General

There are a handful of states that may tax the debt discharged under Biden’s plan if state legislative or administrative changes are not made beforehand, according to the Tax Foundation.

Republican states are leading the charge. In addition to the lawsuit filed by six Republican-led states that say they could be hurt financially by the forgiveness plan, Arizona Attorney General Mark Brnovich also filed a lawsuit last week.

The policy could reduce Arizona’s tax revenue because the state doesn’t consider the loan forgiveness as income, according to the lawsuit. The complaint also argues that the forgiveness policy will hurt the attorney general office’s ability to recruit employees. Currently its employees may be eligible for the federal Public Service Loan Forgiveness program, but some potential job candidates may not view that as a benefit if their student loan debt is already canceled, the lawsuit argues.

Those who meet the program’s annual income limits — up to $125,000 per individual or $250,000 per household — can apply online at https://studentaid.gov/debt-relief/application.

The website for applying for testing was quietly opened by the Education Department on Friday night. More than eight million people had already applied by Monday, Mr. Biden said. The form is available in both Spanish and English, and can be used on computers and mobile devices.

It’s easy. It’s fast,” Biden said in a press conference announcing the launch, noting applications take less than 5 minutes and can be done on desktop or phone.

The Seventh Circuit Circuit Review of the Student Loan Forgiveness Case Against the Biden Administration of Wisconsin’s Social Security Numbers and Birthdate

The application includes asking for the borrowers’ names, birthdates and social security numbers. The form is available in both English and Spanish on desktop and mobile sites. It will be open through Dec. 31, 2023.

The Biden administration’s student loan forgiveness program is under attack by a group of Wisconsin taxpayers.

This case is being heard in the Seventh Circuit. A federal district court judge dismissed the lawsuit earlier this month, on ground that the taxpayer group lacked “standing.” In short, the challengers, simply as taxpayers, could not show a personal injury as is required to bring a suit. In 2007, the Supreme Court said, “if every federal taxpayer could sue to challenge any Government expenditure, the federal courts would cease to function as courts of law and would be cast in the role of general complaint bureaus.”

Barrett acted alone because she has jurisdiction over the lower court that ruled on the case. She declined to refer the matter to the full court. Her denial was contained on the court’s docket.

The lawsuit has not been ruled on by the appeals court. A lower court judge dismissed the lawsuit on October 20, ruling that the states did not have the legal standing to bring the challenge.

The states are expected to file an appeal. The case would be forwarded to the 8th Circuit Court of Appeals, where there is a panel of conservative judges.

The Biden administration is facing a variety of lawsuits, including ones from the Arizona Attorney General.

How simple is it to get debt relief? An application to the Brown County Taxpayers Association during the first week of Obamacare’s website launch

The person who got the emergency application was Amy ConeyBarrett, a justice on the Seventh Circuit Court of Appeals. She made a decision that the other justices probably agreed with.

The challenge brought by six GOP-led states was tossed out by a federal district court in Missouri immediately after the Supreme Court action.

The emergency request to the Supreme Court was brought by the Brown County Taxpayers Association, a Wisconsin organization made up of around 100 taxpaying individuals and business owners that advocates for conservative economic policy.

The plan has been challenged by several other conservative organizations. The lower courts may face the same difficulty in showing harms to stay alive as those lawsuits do.

The student loan forgiveness application was online a week ago. Twitter lit up with joyful posts about debt relief, as well as about the surprisingly easy process.

Twenty-two million people submitted applications during the first week the website was open, eight million of them over the first weekend, a startling contrast to the six people (not six million, nor 6,000 — just six) who successfully negotiated the Obamacare website on the day of its launch in 2013. As professors of public policy, we have shared our research on how administrative burdens make vital public services harder to access with the Biden administration, and we spoke with Department of Education officials about how many people might participate in the program (though we played no role in helping design this process or the application itself). It was amazing to see how easy it was to apply for debt relief.

The streamlined application shows what is possible when government priorities the delivery of public services. The form is easy to complete in a few minutes. It works on a computer and a phone, and it is available in Spanish and English. It’s three simple pages: a welcome page, a form and a confirmation page on which applicants attest that they are eligible. People can be discouraged from starting because beneficiaries don’t have to create an account with a password. Five items of information are required for applicants: name, social security number, birth date, phone number and email address. That is all.

High-Judgement Decision Protects the Rule of Law in the Student Loan Forgiveness Program Despite Trump’s Nominated Judge Mark Pittman

The Texas federal judge found that the law doesn’t give the executive branch clear Congressional authorization to create the student loan forgiveness program.

Judge Mark Pittman, who was nominated by Donald Trump, believed that the program was unconstitutional and must be thrown out.

The Justice Department and the White House disagree with a District Court ruling on student debt relief.

16 million of the 26 million borrowers that gave the Department of Education the necessary information, have already been approved for debt relief, so the Department will keep their information so it can quickly process their relief once we prevail in court.

The administration did not have to go through the formal rule making process under the Administrative Procedure Act, so they were unable to speak up about their differences with the program.

“This ruling protects the rule of law which requires all Americans to have their voices heard by their federal government,” said Elaine Parker, president of Job Creators Network Foundation, in a statement Thursday.