How Biden’s new student debt forgiveness plan differs from his first plan

“I think it would be easier to justify to a court that is skeptical about broad jurisdiction,” said. Luke Herrineassistant professor of law at the University of Alabama, in a previous interview with CNBC.

Tens of millions of borrowers could still benefit if the program lasts.

The plan will forgive debt for borrowers who:

• Are eligible for debt forgiveness under an existing government program but have not yet applied
• Repaid an undergraduate loan in 20 years or longer or over 25 years for a graduate loan
• Attended schools of questionable value
• Having financial difficulties

The Biden administration said it is not entirely clear how financial hardship will be defined, but it could include hardship caused by medical debt or high child care costs.

The new plan also calls for borrowers to have up to $20,000 of unpaid interest forgiven on their federal student debt forgiven, regardless of their income.

After Biden introduced his revised relief program, Missouri Attorney General Andrew Bailey, a Republican, wrote on X that the president “is unabashedly trying to tarnish the Constitution.”

“See you in court,” Bailey wrote.

Missouri is one of six Republican-led states — along with Arkansas, Iowa, Kansas, Nebraska and South Carolina — that have brought strong opposition. lawsuit against Biden’s last-ditch debt relief effort.

Red states argue that the president has exceeded his authority and that debt forgiveness would hurt lenders’ profits. The conservative justices agreed with them.

Higher education expert Mark Kantrowitz said that after the Biden administration officially announced its new student debt forgiveness plan, more legal challenges will be inevitable.

“Lawsuits are likely to follow in the next few days,” Kantrowitz added.