States that are predominantly Republican challenge President Biden’s student loan plan

A group of Republican-led states is taking legal action against the Biden administration to stop a new student loan repayment plan that aims to speed up loan cancellation and reduce monthly payments for millions of borrowers.

In a lawsuit filed in federal court, 11 states led by Kansas claim that President Biden’s creation of the SAVE Plan exceeds his authority. The plan, which has already forgiven loans for over 150,000 borrowers, is being challenged for its similarity to a previous attempt by Biden that was deemed illegal by the Supreme Court last year.

The Education Department, while not commenting on the lawsuit, pointed out that Congress granted the department the power to define income-driven repayment plan terms back in 1993.

The Biden administration remains committed to supporting borrowers, despite opposition from Republican officials, stating that they will continue to provide relief through the SAVE Plan.

The lawsuit was filed amidst a White House initiative to promote the SAVE Plan. Over 7.7 million borrowers have enrolled in the plan, with more than 5 million experiencing reduced monthly payments to $100 or less due to lower incomes.

President Biden introduced the SAVE repayment plan in 2022, along with a proposal to cancel up to $20,000 in debt for over 40 million Americans. While the cancellation plan was blocked by the Supreme Court, the fate of the SAVE Plan remained uncertain.

The lawsuit, filed by Kansas Attorney General Kris Kobach, seeks to immediately halt the implementation of the plan and has the support of 10 other states.

Biden’s new repayment plan builds on existing income-based plans, offering more generous terms and faster loan cancellation. The plan seeks to provide relief to borrowers burdened by student loan debt.

Despite legal challenges, the Biden administration remains committed to implementing the SAVE Plan to help borrowers manage their student loans more effectively.

The lawsuit filed by Republican-led states aims to disrupt Biden’s efforts to provide financial relief to millions of borrowers and could impact the future of student loan repayment programs.

If successful, the lawsuit could undermine Biden’s broader student loan relief initiatives and limit opportunities for borrowers to access loan forgiveness programs.

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