- The 8th Circuit placed a temporary stay on Biden's student-loan forgiveness.
- This means Biden cannot discharge any student loans until a final decision on the legality of the relief is made.
A federal court recently decided President Joe Biden can't cancel any student debt right now — but that doesn't mean the plan is permanently blocked.
On Friday evening, the 8th Circuit Court of Appeals placed a temporary stay on the Biden administration from actually canceling any student debt as it reviews the legality of the broad loan forgiveness — up to $20,000 in relief — that Biden announced at the end of August. This was in response to a request filed by six Republican-led states seeking to permanently block the plan from rolling out. While a federal judge dismissed their case last week and said they lacked the standing to sue, the states later appealed the decision and requested that no loans be discharged until a final decision on the legality of the relief is made.
This doesn't mean the application for student-debt relief on studentaid.gov in closed. In fact, the administration and advocates recommend borrowers keep applying and not become deterred by the Friday ruling.
"Today's temporary decision does not stop the Biden Administration's efforts to provide borrowers the opportunity to apply for debt relief nor does it prevent us from reviewing the millions of applications we have received," Education Secretary Miguel Cardona said in a Friday statement. "Amidst Republicans' efforts to block our debt relief program, we are moving full speed ahead to be ready to deliver relief to borrowers who need the help."
"As we continue our preparations in compliance with this order, we continue to encourage working- and middle-class Americans to apply for debt relief at studentaid.gov. President Biden and this Administration are committed to fighting for the millions of hardworking students and borrowers across the country," he added.
As Cardona noted, the White House will continue to review any applications it receives during this temporary stay, and Biden indicated last week that over 22 million borrowers have already submitted their forms. In terms of what comes next, the appeals court can either choose to dismiss the case and allow the rollout of student debt relief to continue, or it can issue an injunction that would continue keeping the plan on hold. It's unclear when that decision will be announced, but it could come this week.
While this is the first case to succeed in temporarily halting the plan, it's by no means the first attempt to challenge Biden's debt relief. At least five other major lawsuits have been filed by conservative groups attempting to block the loan forgiveness from rolling out, and while at least two of them have been dismissed by federal judges, the dismissal of the suit filed by the six GOP-led states led to a successful appeal. Additionally, a federal judge is hearing arguments on Tuesday on a lawsuit filed by the Job Creators Network — a conservative group that argued the debt relief violates the Administrative Procedure Act's notice-and-comment procedure, which requires an unelected administrator to justify rulemaking to the public.
White House Press Secretary Karine Jean-Pierre said in a Friday statement that "the order does not reverse the trial court's dismissal of the case, or suggest that the case has merit. It merely prevents debt from being discharged until the court makes a decision."
"The Administration will continue to fight Republican officials suing to block our efforts to provide relief to working families," she added.