Washington (AP)— The Supreme Court halted the latest multibillion-dollar Biden administration effort to decrease payments for millions of borrowers on Wednesday while lower courts hear complaints.
The justices rejected an administration request to put most of it back into effect. It was blocked by the 8th U.S. Circuit Court of Appeals.
In an unsigned order, the court said it expects the appeals court to issue a fuller decision on the plan “with appropriate dispatch.”
The Education Department is seeking to provide a faster path to loan cancellation, and reduce monthly income-based repayments from 10% to 5% of a borrower’s discretionary income.
The plan also wouldn’t require borrowers to make payments if they earn less than 225% of the federal poverty line — $32,800 a year for a single person.
Last year, the Supreme Court’s conservative majority rejected an earlier plan that would have wiped away more than $400 billion in student loan debt.
Cost projections for the new SAVE plan differ. Republican-led states challenging the proposal estimate $475 billion over 10 years. Congressional Budget Office estimates $276 billion, according to the government.