A federal appeals court on Friday temporarily blocked President Biden’s student-loan “forgiveness” plan, which would transfer up to $10,000 in student debt from individuals making less than $125,000 to the American public.
The U.S. Court of Appeals for the Eighth Circuit granted an administrative stay in response to a challenge to the order by a coalition of six Republican-led states.
The court’s order instructs the Biden administration not to begin “forgiving” student-loan debt as it considers a request for an injunction from the six states.
The stay comes one day after a lower court dismissed the lawsuit for lack of standing and several days after borrowers first began applying to have their debt “canceled.”
Biden plans to “forgive” up to $10,000 in federal student debt for those making under $125,000 annually and households making under $250,000, as well as relieving $20,000 in debt for Pell grant recipients. The executive action would transfer the cost of the loans to the American public.
Biden’s order is expected to cost $300 billion, according to an estimate by the Wharton School of business at the University of Pennsylvania.
Justice Amy Coney Barrett previously denied a separate emergency application to block the “forgiveness” that had been filed by a Wisconsin taxpayers’ group on Wednesday.