In response to court rulings earlier this week that blocked key components of a student loan policy, the Biden administration is planning to place about 3 million student loan borrowers into a monthslong payment pause. The pause would be very similar to the pandemic-era student loan moratorium -- borrowers would not need to make payments and interest would not accrue. The SAVE Plan, dubbed the most affordable plan for borrowers and President Joe Biden's hallmark surviving student debt reform effort, has been the target of two Republican-led lawsuits that argue the Biden administration has gone beyond its authority in aspects of the plan.
The move to pause millions of borrowers' bills comes after courts in Kansas and Missouri ruled in the GOP states' favor on Monday night, deciding the Biden administration could not go forward with further implementation of the SAVE Plan, which was rolled out last August and is used by 8 million people. In particular, the rulings halted the Department of Education from cutting borrowers' payments beginning July 1, when they were set to decrease from 10% of a borrowers' discretionary income down to 5% for those with undergraduate loans, and from canceling any more loans for people who'd taken out small initial loan balances but had been paying them down for over a decade. So far, 414,000 people have qualified for such debt relief.
In a Thursday night appeal of the Kansas decision, the Department of Justice said the government would need to plac.