- A federal judge in Texas struck down Biden's student-debt relief on Thursday.
- The White House said the Education Department will hold onto borrowers' information during this time.
President Joe Biden's student-loan forgiveness suffered a major blow on Thursday night.
US District Judge Mark Pittman — appointed by former President Donald Trump — struck down Biden's up to $20,000 student-debt relief and declared it illegal, responding to a lawsuit filed by two student-loan borrowers who didn't qualify for the full relief.
The lawsuit, represented by conservative group the Job Creators Network, is the most serious legal setback to the loan forgiveness so far, and raises uncertainty surrounding the implementation of the debt relief and the timeline for it to actually happen.
But Biden's administration remains confident in its authority to discharge millions of borrowers' student loans. In a statement after the ruling, White House Press Secretary Karine Jean-Pierre said that "we strongly disagree with the District Court's ruling on our student debt relief program and the Department of Justice has filed an appeal."
"For the 26 million borrowers who have already given the Department of Education the necessary information to be considered for debt relief – 16 million of whom have already been approved for relief – the Department will hold onto their information so it can quickly process their relief once we prevail in court," she said.
"We will never stop fighting for hardworking Americans most in need – no matter how many roadblocks our opponents and special interests try to put in our way," she added.
Education Secretary Miguel Cardona also spoke out against the ruling, writing on Twitter on Friday that "we believe strongly that the Biden-Harris Student Debt Relief Plan is lawful and necessary to give borrowers and working families breathing room as they recover from the pandemic and to ensure they succeed when repayment restarts."
—Secretary Miguel Cardona (@SecCardona) November 11, 2022
The lawsuit now heads to the conservative 5th Circuit, and it also comes as the 8th Circuit Court of Appeals placed a temporary stay on the debt relief until it makes a final decision on the legality of the policy. It's unclear when the 8th Circuit will make a decision, and at this time, while the administration can continue reviewing borrowers' applications, it cannot actually cancel any of their loans until the court allows it.
Lawmakers on both sides of the aisle have already spoken out on the courts decision, and as expected, Republicans were pleased with the decision. Top republican on the House education committee Virginia Foxx said in a statement that "yet another nail has been added to the coffin of President Biden's illegal student loan bailout, and hardworking taxpayers across the country are rightfully rejoicing."
Meanwhile, Senate Majority Leader Chuck Schumer wrote on Twitter that "this MAGA judge is siding with the special interests over what's best for the people. This is why we need a Senate Democratic Majority. But the law is on our side and we will keep fighting for the millions of Americans with student debt."
It's unclear at this point whether the Education Department will extend the student-loan payment pause, currently set to expire after December 31, in response to these lawsuits, and for now, all borrowers can do is await a final decision from the courts who took on the conservative lawsuits seeking to block student-loan forgiveness permanently.