That's good. Hey, hey!
Ho ho! And the burden of student debt is being lifted
by President Biden, members of Congress who supported.
And it is right.
We ask the United States Supreme Court to believe in
the certain inalienable rights so we can let an
unelected.
Body try to take away relief for our families that are
struggling every single day in the pandemic.
Made it worse for them.
Since the COVID 19 pandemic, student loan
borrowers have had a moratorium on their
payments. The pause on federal loans has lasted
over three years.
But now over 40 million Americans may be hit with a
bill some borrowers have never even seen.
So for years, advocates and borrowers have been
pressuring the government to act on student loan
forgiveness, saying that the student loan system was
broken. Outstanding student loan debt is marching
towards $2 trillion.
You have over 1 in 10 borrowers in delinquency or
default and a number of other issues with the
lending system.
Has got to go.
Hey, hey, ho, ho, student debt has got to go.
President Joe Biden fulfilled his campaign
promise in August of 2022 to forgive $10,000 in
student loan debt for tens of millions of borrowers.
He upped the relief to 20,000 for borrowers who
received a Pell grant in college.
So borrowers may be wondering what is going on
with President Joe Biden's student loan forgiveness
plan since he first rolled out the plan in August.
At least six lawsuits have been brought against the
plan, mostly by Republicans and conservative backed
groups. As those lawsuits made their way through the
courts, the Supreme Court agreed to take on two of the
cases and really examine if this was an act of
presidential overreach.
Another criticism of Biden's sweeping debt relief plan is
its impact on an already indebted economy.
I've been critical of student loan debt relief for
the last two years, but the plan came in, frankly, much
worse than I expected.
And at this point in our economy, we really don't
need to be adding $500 billion of deficit spending
for a purpose that frankly includes wealthy law
students and business school graduates getting
tens of thousands of dollars.
So what the Supreme Court examined at the end of
February are two major things.
One. Have the plaintiffs here actually proven that
they've been harmed by student loan forgiveness in
order to challenge a policy in the courts, you need to
prove that a policy has caused you injury.
It's called legal standing.
Do you have legal standing?
The Supreme Court justices considered if the plaintiffs
had proven that they will be harmed by student loan
forgiveness. The other point that the Supreme Court
was considering at the end of February is does the
president acting within his rights in forgiving this
amount of student debt while the Biden
administration points to the Heroes Act as
justification, the plaintiffs say that that law
allows for much more tailored relief than the
type of sweeping debt cancellation the president
is trying to carry out.
Borrowers camped outside the Supreme Court the night
before the hearings to show their support for Biden's
plan.
So by the morning, there were hundreds of borrowers
outside the Supreme Court.
One borrower that I spoke to said that whether or not
his student debt is canceled and whether or not
he has a monthly student loan bill will determine
whether or not he's able to help his parents who have
retired with not enough money be able to afford
their groceries and their gas bills.
Another borrower told me that student loan debt will
determine whether or not she'll be able to ever save
up for a down payment on a house.
And the stories do get more severe.
There are borrowers who said that the monthly
student loan bill, it's either that or their
medicine. So going into the Supreme Court arguments,
most of the legal experts and professors that I spoke
to said that they thought Biden's student loan
forgiveness plan would face really tough odds at the
Supreme Court considering the conservative majority.
But after the arguments, a lot of them changed their
tunes, which was really interesting. Solicitor
General Elizabeth Prelogar they said that she made a
really convincing case for why the president did have
the power to forgive student debt, pointing out
that although there's been no precedent for this type
of relief, there's also been very little precedent,
at least in 100 years, for this type of public health
crisis. That was the coronavirus pandemic.
She really made it seem like the plaintiffs had more
political issues with the plan than that they could
prove that they would actually be harmed by the
policy.
Experts now believe it will be an uphill battle to
convince the six conservative justices to
side with the three liberals on the bench.
Although the Supreme Court arguments occurred just over
one day. The justices can take months to reach a
decision. Experts that I spoke to said that by the
end of the term, they should make their ruling.
So that'll be sometime in June or July.
Companies like SoFi have come out in opposition to
the White House plan.
If the student loan moratorium ends, there will
be a pickup in student loan refinancing, But we're not
counting on it. We have a diverse business.
And the thing that gates our growth is how much we
invest and where we invest.
If that business comes back, we'll allocate
resources to it to capture the opportunity and meet our
members needs.
Borrowers hope the decision happens soon.
Since the Biden administration has said
payments will resume at the end of August if litigation
isn't resolved.
If the Supreme Court strikes down Biden's student loan
forgiveness plan, you're going to have tens of
millions of Americans who now have to figure out how
to make room in their monthly budget for a student
loan bill they haven't had to pay in over three years.
The Education Department is sounding the alarms that
delinquency rates and default rates could
skyrocket after borrowers have gotten used to for
years not making a student loan payment.
To be clear, our college financing system is broken.
It has a lot of problems.
But doing this type of step is just a way of encouraging
more reliance on debt in the future, increasing the
likelihood that we end up back in further problems.
So there's a lot of research that shows that federal
student debt makes it much harder for Americans to come
up with a down payment to buy a house, to save for
their retirement, to buy stocks and to start small
businesses. So you would see a lot of those impacts
likely pick up again once Americans have a new student
loan bill due.
If the decision is unfavorable for borrowers,
there are a few ways to prepare for payments to
resume.
So what you can do to prepare is to start saving,
put money aside in a savings account so that when
those student loan bills resume, it's a little bit
less of a shock to you.
You have some money saved aside and you're prepared.
It's also a good idea for borrowers to get
familiarized with their options when payments
resume. If you are struggling, there are a
number of ways that you can keep your payments on pause.
Those are through forbearances for people who
are unemployed or experiencing an economic
hardship.