Federal judges in Kansas and Missouri issued rulings Monday, June 24, that blocked key parts of President Joe Biden’s student debt relief plan, specifically the aspects that adjust payment amounts based on a borrower’s income. As a result, further implementation of the SAVE program is now halted.
This program, which has been operational for nearly a year, links a borrower’s monthly payment amount to their income. The blocked second phase of the plan would have reduced monthly payments from 10% of a borrower’s discretionary income to 5%.
The rulings also pauses any further debt cancellation for individuals who took out smaller initial loans and have been making payments for over 10 years. Despite these rulings, the White House said it remains committed to supporting students and borrowers.
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“Today’s rulings won’t stop our administration from using every tool available to give students and borrowers the relief they need,” White House press secretary Karine Jean-Pierre said in a statement.
It’s important to note that the SAVE Plan, unveiled by Biden in 2022 as part of a larger $430 billion initiative to fulfill a campaign promise, aimed to cancel up to $20,000 in debt for up to 43 million Americans. However, this initiative was blocked by the conservative-majority U.S. Supreme Court in June 2023.
