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The Supreme Court has issued its opinion on President Joe Biden's student loan forgiveness plan.
WASHINGTON — The Supreme Court finished its term Friday with a long-awaited decision on President Joe Biden's student loan forgiveness plan, ruling that the HEROES Act does not authorize the relief plan.
The 6-3 decision, with conservative justices in the majority, effectively killed the $400 billion plan, announced by Biden last year, and left borrowers on the hook for repayments that are expected to resume by late summer.
The court held that the administration needs Congress' endorsement before undertaking so costly a program. The majority rejected arguments that a bipartisan 2003 law dealing with student loans, known as the HEROES Act, gave Biden the power he claimed.
“Six States sued, arguing that the HEROES Act does not authorize the loan cancellation plan. We agree,” Chief Justice John Roberts wrote for the court.
Justice Elena Kagan wrote in a dissent, joined by the court’s two other liberals, that the majority of the court “overrides the combined judgment of the Legislative and Executive Branches, with the consequence of eliminating loan forgiveness for 43 million Americans.”
It's not immediately clear whether the White House has a backup plan to try again to implement widespread student loan relief. Press secretary Karine Jean-Pierre has consistently declined to discuss other alternatives, insisting the administration believes the plan's legal standing was strong enough to survive the court challenge.
The conservative-majority court seemed poised to strike down Biden's plan, which sought to erase $10,000 in federal student loan debt for those with incomes below $125,000 a year or households that earn less than $250,000. He also wanted to cancel an additional $10,000 for those who received federal Pell Grants to attend college.
When the plan was first announced, the federal government said it believed around 40 million Americans would be eligible, with nearly half of those people having their federal student debt wiped out entirely.
This is a breaking news story and will be updated with more details from the Supreme Court decision and reaction from the White house. Below you can find information on when student loan payments resume again.
When do student loan payments resume?
Even before Friday's ruling, the payment pause was set to expire 60 days after June 30.
The U.S. Department of Education has previously confirmed that student loan payments will be due again in October, with interest kicking in on Sept. 1, restarting loans that have been frozen since March 2020.
The pandemic-era pause on both payments and the accumulation of interest on those deferred payments has been extended eight times in the past three years as the country grappled with the COVID-19 virus.
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