The U.S. 8th Circuit Court of Appeals has officially ended former President Joe Biden’s student loan forgiveness initiative. The decision, announced on Tuesday, marks the conclusion of Biden’s attempt to implement widespread student debt relief.
Missouri Attorney General Andrew Bailey initially filed a lawsuit against the Biden administration regarding its $500 million loan cancellation effort, known as the SAVE plan. The court ruled that the Secretary of Education had exceeded legal authority by creating a program that primarily forgives loans instead of ensuring repayment.
Bailey emphasized that, while the ruling does not affect current policies, it prevents future presidents from replicating Biden’s approach, stating, “although Joe Biden is no longer in office, this ruling sets a vital precedent to prevent any president from imposing the financial burden of student loan debt on hard working Americans.”
Previously, the Supreme Court had refused to lift an injunction against the SAVE plan, reports Fox News. A federal appeals court in Missouri had already suspended the program, preventing it from being enforced while legal challenges progressed in lower courts. The Biden administration’s Department of Justice later sought emergency intervention from the Supreme Court.
The administration argued that the nationwide injunction imposed by the lower court was excessive, effectively halting the program altogether. “Our Administration remains committed to vigorously defending the SAVE Plan, which has benefited over 8 million borrowers by lowering their monthly payments. This includes 4.5 million individuals who now have zero-dollar monthly payments,” a White House spokesperson told Fox News Digital. “We will continue to resist Republican-led efforts to increase student loan payments for millions of Americans.”
Biden introduced the SAVE plan after the Supreme Court rejected his initial student loan forgiveness proposal. The White House highlighted that the SAVE initiative could reduce monthly payments to zero for some borrowers, cut costs in half for others, and save eligible borrowers at least $1,000 annually. Furthermore, individuals with an initial loan balance of $12,000 or less would have any remaining debt forgiven after a decade of payments.