Federal Court of Appeals Allows DoE to Push Through with Student Loan Reductions

stydent loan reductionThe 10th US Circuit Court of Appeals allowed the DoE to push through with the SAVE loan payment reduction plan for which more than 8 million people had signed up. Among those who signed up, around 4.5 million borrowers qualified for $0 monthly payments in light of their low income.
refuced loan payments based on familu incomeUnder the Biden Administration, the Department of Education (DoE) introduced last year the Saving on a Valuable Education (SAVE) plan, to lower student loan payments based on earnings and family size of a student borrower. However, the DoE had to seek approval from the federal appeals court after the authority of the department to lower the student loan payments was blocked by federal judges in the states of MIssouri and Kansas.

Missouri and Kansas Courts Ruled in Favor of Petitions to Block the Biden Administration’s SAVE Plan

Two judges had in fact issued rulings in favor of petitions to block some parts of the SAVE loan repayment plan. In line with such decisions, the DoE announced the freezing of the student loan payments in the said states, including related interest of some 3 million borrowers.
U.S. District Judge John A. Ross in Missouri, barred the DoE from granting additional SAVE student loan forbearance. Apparently, some student borrower loans in Missouri have been forgiven after ten years, which stands in contrast to the standard 20- to 25-year plan.

In Kansas, U.S. District Judge Daniel D. Crabtre stated that only Congress can answer questions about the matter of forgiving billions of dollars of student loans. He added that Kansas’ blue collar workers who did not go to college should not be made to pay for the student loans of New Yorkers with degrees in gender studies such as those that critically examine the cultural, social and historical compositions and experiences of genders.