WASHINGTON — President Joe Biden announced Friday that some federal student loan borrowers will have their loans cancelled under the Department of Education’s new repayment plan.

Starting next month, people who took out under $12,000 in federal student loans and have been repaying those loans for 10 years will get their remaining student loan balance cancelled in the Saving on a Valuable Education Plan, known as SAVE.

“This action will particularly help community college borrowers, low-income borrowers, and those struggling to repay their loans,” Biden said in a statement.

“And, it’s part of our ongoing efforts to act as quickly as possible to give more borrowers breathing room so they can get out from under the burden of student loan debt, move on with their lives and pursue their dreams.”

This initiative builds on the Biden administration’s effort to cancel federal student loan debt following last year’s U.S. Supreme Court decision that struck down the White House’s plan for a one-time cancellation of up to $10,000 for federal borrowers. Student loan borrowers who had received Pell Grants — federal aid to help low-income students pay for higher education — could have qualified for an additional $10,000 in forgiveness.

, the White House announced its SAVE plan, along with a one-year off-ramp program that would not report borrowers to creditors if they failed to make loan payments once repayment started back up in October.

“And, in the wake of the Supreme Court’s decision on our student debt relief plan, we are continuing to pursue an alternative path to deliver student debt relief to as many borrowers as possible as quickly as possible,” Biden said. “I won’t back down from using every tool at our disposal to get student loan borrowers the relief they need to reach their dreams.”

So far, 6.9 million borrowers have enrolled in SAVE, and of those borrowers, 3.9 million have a $0 monthly payment.

Under the new plan, SAVE calculates payments based on a borrower’s income and family size and forgives balances after a set number of years. The Department of Education has estimated that most borrowers will save about $1,000 per year under the new plan.

Borrowers who are in the former payment plan — known as the Revised Pay as You Earn plan — will automatically be enrolled in the SAVE program.

The states with the highest number of borrowers enrolled in the program include Texas, with 591,700, California with 597,300, Florida with 475,800, New York with 374,300 and Pennsylvania with 289,800.

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Ohio Attorney General Dave Yost is trying to prevent billions of dollars of student loan debt from being forgiven.

Yost filed an amicus brief recently with the U.S. Supreme Court — along with 19 other states — arguing U.S. Secretary of Education Miguel A. Cardona’s plan to wipe away an estimated $6 billion in student loan forgiveness for more than 200,000 borrowers is “nothing more than an egregious power grab that tramples all over the separation-of-powers doctrine,” according to a release from Yost.

“The executive branch does not have unlimited policymaking power, nor an unlimited bank account to forgive student loan debt,” Yost said. “The executive branch cannot extend its authority as it sees fit.”

The Project on Predatory Student Lending filed a lawsuit in 2019 (Sweet vs. Cardona) on behalf of borrowers who believed they were defrauded by the schools they attended. Cardona agreed to a settlement last summer that would give 200,000 impacted borrowers $6 billion in debt relief.

Two for-profit higher-education companies Lincoln Educational Services Corp. and American National University, along with non-profit Everglades College, filed notices in January to place a stay on the relief.

The Ninth Circuit Court of Appeals rejected the companies’ request to pause the relief last week — paving the path for those borrowers to have their debt forgiven.

There are 151 schools in the Sweet v. Cardona settlement agreement, including Chamberlain University, DeVry University and Kaplan College, which have campuses in Ohio.

The brief argues Cardona has no legal authority to do what the settlement requires.

These states’ attorneys general joined Yost in the amicus brief: Alabama, Alaska, Arkansas, Florida, Georgia, Idaho, Indiana, Kansas, Kentucky, Louisiana, Mississippi, Montana, North Dakota, South Carolina, Tennessee, Texas, Utah, West Virginia and Wyoming.

How much student loan debt do Ohioans have?

The federal appeals court ruling is not related to the Biden administration’s federal student loan forgiveness plan, which is currently being reviewed by the U.S. Supreme Court.

Biden announced in August he would forgive up to $10,000 in federal student loans for people with annual incomes of $125,000 or less, and an additional $10,000 for people who received Pell grants, federal monies allotted for low-income students who want to pursue higher education.

There are 1,818,300 student loan borrowers in Ohio who together owe $63.1 billion as of Dec. 31, according to the U.S. Department of Education.

Fifteen percent of Ohioans have student loans — tied with Georgia and Mississippi for the state with the most outstanding student loans with, according to small business website AdvisorSmith’s 2021 report Only the District of Columbia was slightly higher with 16%.

The average student loan balance in Ohio was $34,923, according to the AdvisorSmith report.

Nationally, people who are 35 to 49 have the most student debt with $636.2 billion, but most student loan borrowers are people who are 25 to 34 as of the first fiscal quarter of 2023, according to the U.S. Department of Education.

Recent data also shows student loan debt , with students of color saddled with nearly twice as much debt as white students.

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WASHINGTON — A federal appeals court on Monday issued a nationwide injunction indefinitely blocking the Biden administration’s student debt relief program in response to a challenge by six GOP-led states.

The unanimous by the 8th Circuit Court of Appeals in St. Louis came after the six states — Nebraska, Missouri, Arkansas, Iowa, Kansas and South Carolina — argued that the loan relief program threatens those states’ future tax revenues and that the plan by the Biden administration overrode congressional authority.

“The injunction will remain in effect until further order of this court or the Supreme Court of the United States,” according to the by a three-judge panel. 

Those judges are and , both President George W. Bush appointees, and  a President Donald Trump appointee. 

The White House in a statement defended the program, which has been the subject of several lawsuits. 

“We are confident in our legal authority for the student debt relief program and believe it is necessary to help borrowers most in need as they recover from the pandemic,” said White House press secretary Karine Jean-Pierre. “The Administration will continue to fight these baseless lawsuits by Republican officials and special interests and will never stop fighting to support working and middle class Americans.”

The Biden administration for its student debt relief program last week following a decision from a Texas judge on Thursday that struck down the program, calling it “unconstitutional.” The Department of Justice has filed an appeal to that decision. Current applications are being held by the Department of Education.

Missouri connection

A federal judge in the six-state lawsuit, ruling that those states lacked legal standing to pursue a case on the grounds that they will be harmed in the future. 

However, the appeals court found that in Missouri, that state had shown likely injury, as a major loan servicer — Missouri Higher Education Loan Authority, known as MOHELA — that is based in the state would lose revenue because of the debt relief program. 

“Due to MOHELA’s financial obligations to the State treasury, the challenged student loan debt cancellation presents a threatened financial harm to the State of Missouri,” according to the panel. “Missouri, therefore, likely has legal standing to bring its claim. And since at least one party likely has standing, we need not address the standing of the other States.”

The three-judge panel decided against restricting the injunction to those six states because it would “be impractical and would fail to provide complete relief,” and because MOHELA has loans nationwide.

“Given MOHELA’s national role in servicing accounts, we discern no workable path in this emergency posture for narrowing the scope of relief,” according to the order. 

​â¶Ä‹Americans have student loan debt, and the Federal Reserve that the total U.S. student loan debt is more than $1.76 trillion.

The Biden administration’s plan would forgive up to $10,000 in loan forgiveness for eligible student loan borrowers, while the recipients of Pell Grants could apply for up to $20,000 in debt relief. The program is intended to assist borrowers who, in 2021, earned no more than $125,000 per year, and couples who earned up to $250,000 per year.

More than 26 million student loan borrowers applied for the program, and 16 million have been accepted, according to Jean-Pierre.

Student loan repayments have been paused since early 2020, due to the coronavirus pandemic, and are set to resume Jan. 1. The Biden administration has not announced if it will extend a pause on student loan repayments.

is part of States Newsroom, a network of news bureaus supported by grants and a coalition of donors as a 501c(3) public charity. Louisiana Illuminator maintains editorial independence. Contact Editor Greg LaRose for questions: info@lailluminator.com. Follow Louisiana Illuminator on and .