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The court’s decision effectively suspends the SAVE Plan, which was designed to lower repayment amounts and accelerate debt cancellation for millions of borrowers.
The ruling was delivered by a panel of three judges, all appointed by Republican presidents. Judge L. Steven Grasz, appointed by President Donald Trump, wrote that while the law allows for income-driven repayment plans, it does not extend to broad loan cancellations. The panel agreed that Biden’s plan prioritised debt elimination over repayment, a move that exceeded legal limits.
The legal battle was initiated by seven Republican-led states, including Missouri, which challenged the legality of the SAVE Plan. Missouri Attorney General Andrew Bailey hailed the court’s decision, stating it ensures that taxpayers are not burdened with repaying others’ student loans.
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