Where Is Student Loan Forgiveness Now?
President Biden’s massive plan to write off student loan debt for millions of Americans is currently on hold. With the forgiveness program stuck in the courts , borrowers are also stuck wondering if they’ll ever see a penny of long-awaited relief. Things aren’t looking good right now: As of this week, the Biden administration is no longer accepting student loan write-offs.
However, not all hope is lost. Here’s what you need to know about the administration’s legal challenges and what other forms of student loan forgiveness may be adopted in the future.
Where is the Biden plan now?
On Monday, the 8th U.S. Circuit Court of Appeals in St. Louis extended an earlier temporary suspension of Biden’s student loan write-off program. The decision comes days after a federal judge in Texas blocked the program . All of these attempts to block student loan write-offs argue that, without congressional approval, Biden’s plan for debt relief was an abuse of power.
The Texas case has been appealed, and AP News reports that the administration will likely also appeal the 8th Circuit’s decision. The Department of Education says on its federal student aid website that they are “seeking to repeal” orders blocking the student debt relief program. As the Biden administration claims they will continue to fight for the plan, student loan write-offs will likely make it to the Supreme Court.
What does this mean to you
For borrowers, the most notable impact of these legal strikes so far is that applications for Biden’s plan to write off student loans are currently not being accepted . And while these legal withholdings may not be permanent, timing is a concern: The pandemic student loan pause is coming to an end on Dec. 31, meaning millions of Americans will enter 2023 not knowing when or how they’ll have to resume repayments. .
As USA Today explains , there are so many other forms of debt relief. Theoretically, Congress could write off the debt on its own, but with the Republican-controlled House of Representatives coming to power in January, this option is unlikely. Instead, it looks like the administration will continue to shape the current plan until it takes shape that can withstand the onslaught of Republican-appointed federal judges. Unfortunately, the result of this process is likely to be a much narrower plan of assistance.
What should you do right now
Bottom line: You likely won’t see Biden’s plan to write off student loans come to fruition anytime soon. And if/when the program is implemented, it will most likely not be as “broad” as it was originally announced.
This means that while student loan forgiveness is stuck in the courts, you must get your repayment plan in order before the loan freeze ends next month.
How to find your loans (and loan providers)
Here is a quick overview of how to figure out the current status of your student loans when repayments resume in January 2023:
Go to studentaid.gov . Note. This is not the same portal you would normally use to pay your student loan (for example, through a service provider like Sally Mae). After logging in, select “My Help” from the drop-down menu under your name. Your credit service organizations should appear in this section. By clicking on Loan Breakdown, you will see a list of loans you have received, including loans that you have paid off or combined into a new loan.
Once you have verified your loan company, visit that service provider’s website and log into your account to make sure all your contact information is up to date so that you don’t miss any notification from them during this process.