Before it adjourns for its summer break in late June or early July, the Supreme Court is expected to make a decision on the Joe Biden administration’s student loan forgiveness program, according to analysts.
Payments will restart within 60 days if the Supreme Court rejects a blanket loan discharge.
Student Loan Forgiveness By Supreme Court Decision May Last Due To Partisan Divide
The ruling may have an impact on about 37 million Americans. By the end of the Supreme Court’s term, which is in late June or early July, opinions are usually delivered.
According to the website for the United States Courts, while unanimous rulings are announced earlier in the term, opinions on contentious matters may not be released until the very last day.
The decision on student loan will probably be one of the last ones made public because it is almost guaranteed to be divided along party lines, or very close to it.
The ruling is expected to be made on a Thursday since that is the day justices have been publishing their opinions lately, according to higher education analyst Mark Kantrowitz, who spoke with CNBC.
As per the Congressional Budget Office, Biden’s student debt forgiveness plan, which was submitted by the Education Department during the coronavirus outbreak, could erase nearly $430 billion in student debt.
Read more: Student Loan Repayment Pause Will Soon End; What’s Next?
Student Loan Suspension Proposed During Pandemic
The total amount owed on student loans would go from $1.6 trillion to roughly $1.17 trillion.
Kantrowitz calculated that the approach would completely wipe out all the student loan debt of about 14 million people. Others might have a $10,000–$20,000 reduction in debt.
Under the Heroes Act of 2003, the US Secretary of Education has the power to modify student loan terms in the event of a national emergency.
During the epidemic, which constituted a national emergency, the Education Secretary and President Joe Biden proposed a student loan suspension; this was followed by a proposal for loan forgiveness.
Read more: Supreme Court And Student Loan Forgiveness: Awaiting The Decision