President Joe Biden’s initiative to lower monthly payments for student loan borrowers has been stopped in its tracks, according to multiple outlets, as a federal appeals court granted a request to partially block the plan after other parts of it were blocked by a lower court last month.
The SAVE Plan was introduced in 2022. (Photo by Anna Moneymaker/Getty Images)
The 8th Circuit Court of Appeals granted a request made by multiple Republican-led states to nullify the entirety of the program, the Associated Press reported.
The debt relief initiative, known as the SAVE Plan, reduces monthly payments to as low as $0 per month for borrowers and allows those who have borrowed $12,000 or less to receive loan forgiveness after 10 years of payments.
Parts of the plan were blocked by two federal judges last month, which prevented the Department of Education from going ahead with further loan forgiveness on the July 1 effective date.
The rulings from last month and Thursday do not impact borrowers’ whose debt has already been forgiven, as 4.3 million borrowers in the SAVE Plan had their payments reduced to $0.
$1.75 trillion. That is how much student loan debt Americans collectively own as the average borrower has racked up $28,950 in debt on average.
This is a developing story. Check back for updates.