Student Loan Borrowers Crushed By Appeals Court Ruling, Credit Scores Plunge

The courts are busy. This one goes against Biden. Economic repercussions are significant…

The New York Post reports Biden’s $475B student debt cancellation plan blocked as federal appeals court issues final decision

A federal appeals court delivered a crushing blow Tuesday to a more than $475 billion student debt cancellation program begun by former President Joe Biden, ordering the underlying regulation be blocked in its entirety.

The Eighth US Circuit Court of Appeals had partially blocked the loan forgiveness effort last year — but a three-judge panel at the St. Louis-based court issued a final judgment to a lower court prohibiting any part of the initiative from taking effect.

Judge L. Steven Grasz in a 25-page opinion ruled that Biden’s Education Secretary, Miguel Cardona, had “gone well beyond” his constitutional authority in creating the Saving on a Valuable Education (SAVE) plan.

“Rather than implying by omission or other ambiguities, Congress has spoken clearly when creating a repayment plan with loan forgiveness or otherwise authorizing it — explicitly stating the Secretary should cancel, discharge, repay, or assume the remaining unpaid balance,” Grasz wrote, finding “no comparable language” in the SAVE Plan.

In 2023, the Penn Wharton Budget Model estimated the so-called “repayment plan,” which Grasz said allowed for student debt to be “largely forgiven rather than repaid, would cost taxpayers $475 billion over the next decade.

That was after $1.2 billion already went out the door to student borrowers under the program, which started in February 2024. Around 7.5 million Americans signed up for debt cancellation in all.

“We obtained another court order BLOCKING an illegal Biden-era student loan scheme,” Missouri AG Andrew Bailey crowed on X. “Though @JoeBiden is out of office, this precedent is imperative to ensuring a President cannot force working Americans to foot the bill for someone else’s Ivy League debt.”

In total, the Biden administration cancelled around $183.6 billion in student debt.

“He isn’t ‘forgiving’ debt. He is taking the debt from those who willingly took it out to go to college and transferring it onto taxpayers who decided not to go to college or already paid off their loans,” Sen. Bill Cassidy (R-La.) charged in a statement last year.

Supreme Court Chief Justice John Roberts wrote in the majority opinion striking down the first $430 billion effort that an education secretary “has never previously claimed powers of this magnitude.”

Student Loan Borrowers Are Losing 100+ Credit Points

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