{"id":13286,"date":"2023-05-24T17:35:39","date_gmt":"2023-05-24T21:35:39","guid":{"rendered":"https:\/\/ifintechworld.com\/news\/house-passes-bill-nullifying-student-loan-forgiveness-credit\/"},"modified":"2023-05-24T17:35:40","modified_gmt":"2023-05-24T21:35:40","slug":"house-passes-bill-nullifying-student-loan-forgiveness-credit","status":"publish","type":"post","link":"https:\/\/ifintechworld.com\/?p=13286","title":{"rendered":"House Passes Bill Nullifying Student Loan Forgiveness Credit"},"content":{"rendered":"
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House Republicans just approved a plan to repeal key Biden student debt relief initiatives. Advocacy groups are warning that if the plan is ultimately enacted, millions of borrowers could have their student loan forgiveness credit voided. And thousands who already received loan forgiveness could have their discharged debts reinstated.<\/p>\n

Biden has promised to veto the measure. But his administration\u2019s student debt relief initiatives remain under attack.<\/p>\n

Here\u2019s the latest.<\/p>\n

House Republicans Approve Resolution Nullifying Biden\u2019s Student Loan Forgiveness Plan And Student Loan Pause Extension<\/strong><\/h2>\n

House Republicans on Wednesday approved a Congressional Review Act resolution nullifying two key Biden administration student debt relief initiatives. This includes President Biden\u2019s unprecedented one-time student loan forgiveness plan, which \u2014 if approved \u2014 would provide tens of millions of borrowers with $10,000 or $20,000 in one-time debt relief. That plan has been held up for months in a drawn-out legal battle, which is now before the Supreme Court. The GOP-led resolution would also repeal Biden\u2019s most recent extension of the student loan pause, which has suspended most federal student loan payments and interest through this summer.<\/p>\n

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\u201cPresident Biden\u2019s so-called student loan forgiveness programs do not make the debt go away, but merely transfer the costs from student loan borrowers onto taxpayers,\u201d said Rep. Bob Good (R-Va.), one of the lead cosponsors of the repeal effort, in a statement in March when the initiative was first unveiled by Republican leaders. \u201cCongress should stop these unilateral actions, and I am proud to lead the fight in the House to hold President Biden accountable for his reckless, unfair, and unlawful student loan proposal.\u201d<\/p>\n

The Congressional Review Act, or CRA, allows Congress to nullify recently-enacted federal rules and programs. CRA resolutions only require simple majority votes in the House and Senate for congressional approval.<\/p>\n

Groups Warn Student Loan Forgiveness Approvals Could Be Reversed<\/h2>\n

Advocacy groups are sounding the alarm that the Republican-led repeal effort could have devastating impacts for borrowers. In addition to eliminating Biden\u2019s one-time debt relief plan, the reversal of Biden\u2019s extension of the student loan pause could cause many borrowers who already received student loan forgiveness under other programs to have their loan forgiveness reversed, and their loans reinstated.<\/p>\n

That\u2019s because the student loan pause period can count as credit toward student loan forgiveness under the Public Service Loan Forgiveness (PSLF) and Income Driven Repayment (IDR) programs. Borrowers who received enough PSLF or IDR credit during Biden\u2019s most recent extension of the student loan pause to reach the threshold required for student loan forgiveness had their balances discharged.<\/p>\n

But if the Republican-led repeal effort is successful, thousands of borrowers could have those loan forgiveness determinations undone. A new analysis by the Student Borrower Protection Center (SBPC) and the American Federation of Teachers estimates that upwards of 260,000 public service borrowers who received student loan forgiveness through PSLF during the last several months could have their loans reinstated if the initiative becomes law. And two million additional borrowers who received PSLF and IDR credit associated with the current extension of the student loan pause could have that credit nullified, forcing them to be in repayment for longer.<\/p>\n

\u201cThis is a disaster,\u201d said American Federation of Teachers President Randi Weingarten in a statement on Tuesday. \u201cFor years, the AFT and SBPC have fought the damage forced by the Trump Administration on student loan borrowers and their families. Now, MAGA politicians don\u2019t just want to stop that progress, they want to reinstate student debt previously cancelled for more than 260,000 teachers, nurses, firefighters, and others. It\u2019s an immoral clawback of the absolute worst kind.\u201d<\/p>\n

Other advocacy groups echoed these concerns. \u201cOverturning the payment pause and forcing borrowers into immediate repayment would be catastrophic. It would inflict harm upon millions of Americans, particularly the most financially vulnerable among us, who are still struggling to recover from the pandemic,\u201d said Cody Hounanian, Executive Director of the Student Debt Crisis Center, in a statement on Tuesday. \u201cThe CRA is a shocking abdication of lawmakers\u2019 duty to support the financial health of families nationwide.\u201d<\/p>\n

House Republicans pushed back against other critiques that passage of the bill would force borrowers to retroactively make payments covering the voided student loan pause period. \u201cAmerica shouldn\u2019t buy accusations from the Left that H.J. Res. 45 will charge borrowers backpay on interest payments,\u201d said Rep. Virginia Foxx (R-NC) in a speech on the House floor on Wednesday. \u201cIt couldn\u2019t be further from the truth. Nowhere in this resolution does it mandate backpay. It is prospective, not retrospective. If anything, it will be Secretary Cardona\u2019s decision to enact backpay.\u201d<\/p>\n

Student Loan Forgiveness Repeal Efforts Continuing<\/h2>\n

With the House\u2019s approval of the CRA resolution, the bill now heads to the Senate. 49 Republican senators have co-sponsored the resolution in that chamber. Democrats hold a slim Senate majority, but it would take just two Democrats to join these Republicans for the measure to pass, and some moderate Democrats have expressed openness to repeal. The CRA only requires a simple majority in the Senate; the resolution is not subject to a filibuster, which typically requires 60 votes to overcome.<\/p>\n

However, even if it passes the Senate, President Biden must sign the CRA resolution for it to become law. And this week, the administration indicated that Biden will veto the measure, likely dooming it. A two-thirds majority in both the House and Senate are required to override a presidential veto, a likely insurmountable hurdle given near-even party control in both chambers of Congress.<\/p>\n

But GOP-led efforts to repeal Biden\u2019s student loan forgiveness and debt relief plans continue. House Republican leaders passed separate legislation last month nullifying both initiatives in a federal spending bill to raise the national debt limit. That bill has no chance of passing the Senate, but House GOP leadership and President Biden are locked in intense negotiations over a compromise to avert a debt ceiling crisis. With no agreement reached yet, it is not at all clear how student debt relief will be treated.<\/p>\n

\u201cWe are fighting for the plumber with no student loans and the veteran that sacrificed for the nation, Democrats are bailing out people with master\u2019s degrees in gender studies,\u201d said Rep. Chip Roy (R-TX) in a letter<\/a> to Republican colleagues this week, urging them to reject any compromise with President Biden over the debt ceiling.<\/p>\n

Meanwhile, legal battles over Biden\u2019s initiatives continue to play out in the courts. There are now two legal challenges over the president\u2019s student loan pause extension. And the Supreme Court is expected to separately rule on Biden\u2019s student loan forgiveness plan in just a few weeks.<\/p>\n

Further Student Loan Forgiveness Reading<\/strong><\/h2>\n

If The Supreme Court Rejects Student Loan Forgiveness Plan, Biden Could Do This<\/p>\n

Lowering Student Loan Payments Just Got Easier Amid Uncertainty Over Loan Forgiveness<\/p>\n

Student Loan Forgiveness Eligibility Expanded In 3 Ways Under New Account Adjustment Guidance<\/p>\n

$55 Billion In Student Loan Forgiveness Approved, Says Biden Administration \u2014 And More May Be Coming<\/p>\n<\/div>\n