A federal judge in Georgia has temporarily blocked the Biden administration from implementing its latest plan to bring widespread federal student loan cancellation for up to 30 million borrowers.
The 14-day restraining order was handed down Sept. 5, two days after a coalition of seven Republican-led states preemptively sued to stop the plan, claiming that the federal government is “unlawfully trying to mass cancel hundreds of billions of dollars of loans” and planning to do so by Sept. 7.
The plan in question, popularly known as “Plan B,” has been in the works since last summer, when the U.S. Supreme Court struck down the initial effort by the Biden administration to offer a blanket cancellation of up to $400 billion in student loans. It has yet to be published, although borrowers were asked last month to confirm whether they want to opt-out.
According to the U.S. Department of Education, Plan B would primarily benefit those who owe more than they originally borrowed due to accrued interest. It would erase up to $20,000 beyond the principal balance, regardless of the borrower’s income. Some 23 million may even see their entire interest balances eliminated.
.jpg){kind=link}