Federal Appeals Court Blocks Biden’s SAVE Student Loan Repayment Plan

A federal court on Thursday blocked a student loan repayment plan designed to be more generous to borrowers, the latest in a legal back and forth over the Biden administration’s efforts to provide debt relief.

The Eighth Circuit Appeals Court ruled in favor of a coalition of Republican-led states that sued the government to stop the Saving on a Valuable Education (SAVE) Plan.

The ruling Thursday is not the final say in the case, but it does block the Department of Education from implementing any remaining parts of the SAVE plan that weren’t blocked by previous court orders until the appeals court makes a final ruling on an injunction.

Part of Ongoing Battle Over Debt Relief

The repayment plan in question was designed to forgive balances for borrowers who make on-time payments for 20 or 25 years, like previous iterations of income-driven repayment plans. However, this plan would require far lower payments—more than half of borrowers enrolled in the plan could make progress toward forgiveness without paying anything.

This is the latest development in the legal saga that has played out as President Joe Biden has made multiple attempts to relieve student loan debt. The Supreme Court struck down his original attempt to outright forgive student loans for millions of borrowers. The SAVE plan was a different approach to forgiveness and borrowers enrolled have been in limbo as this case has wound its way through court.