The U.S. Supreme Court will be hearing arguments this week over two legal challenges brought against President Biden’s student loan forgiveness plan. The decision from these challenges could make or break Biden’s overall plan for loan forgiveness, affecting tens of millions of American borrowers.
Since President Biden made his initial announcement regarding his loan forgiveness plan, his policy has faced six legal challenges. The two challenges before the high court now have consolidated these suits. One legal challenge has been brought by six states, including Arkansas, Iowa, Kansas, Missouri, Nebraska, and South Carolina. The other challenge has been backed by the Job Creators Network Foundation, a conservative-based advocacy group.
The legal question before the court has no current precedent. The question involves whether the President has the authority to issue such sweeping debt forgiveness. The White House insists they have this authority and argue that cancelling this large amount of student loan debt is imperative to relieve borrowers who are struggling from a broken lending system.
To back his plan, the Biden administration claims they are arguing within the parameters of the Heroes Act of 2003, which granted the Secretary of Education the authority to make changes related to student loans during times of national emergencies. They say that this forgiveness can be lumped in with actions the President has been acting under since March 2020 when the COVID-19 pandemic first hit.
Dozens of Republican lawmakers have filed briefs with the Supreme Court, arguing that the president acted outside his authority when issuing the executive order. They insist that Biden’s student loan forgiveness plan should be ruled unconstitutional. They argue that the administration is incorrectly using the Heroes Act, a law which was originally passed shortly after the September 11th terrorist attacks.
If allowed to move forward, this debt relief will wipe out a large chunk of the total $1.7 trillion student loan debt the nation is facing. Biden’s plan will wipe out about $400 billion of student loan debt and if allowed to go forward will be one of the most expensive executive actions in U.S. history.
Proponents of the law are concerned regarding the possible outcome from the Supreme Court. The high court’s conservatives have been very aggressive in striking down some of the more liberal Presidential executive orders and Congressional actions. If history repeats itself, it may be very likely that this executive order will also be struck down. However, it remains to be seen the course these two legal challenges will take until oral arguments begin this week.
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For borrowers who are struggling with student loan debt, relief options are available. Many student loan borrowers are unaware that they have rights and repayment options available to them, such as postponement of loan payments, reduction of payments or even a complete discharge of the debt. There are ways to file for bankruptcy with student loan debt. It is important you contact an experienced Miami bankruptcy attorney who can advise you of all your options. As an experienced CPA as well as a proven bankruptcy lawyer, Timothy Kingcade knows how to help clients take full advantage of the bankruptcy laws to protect their assets and get successful results. Since 1996 Kingcade Garcia McMaken has been helping people from all walks of life build a better tomorrow. Our attorneys help thousands of people every year take advantage of their rights under bankruptcy protection to restart, rebuild and recover. The day you hire our firm, we will contact your creditors to stop the harassment. You can also find useful consumer information on the Kingcade Garcia McMaken website at www.miamibankruptcy.com.
SOURCE:
Supreme Court readies to hear Biden’s student loan forgiveness case (cnbc.com)