US states opposing student loan forgiveness made false claims, files reveal

theguardian.com:

Newly uncovered documents show that the Republican states fighting Joe Biden’s student loan forgiveness plan have made false claims that they will “suffer injuries”, or rather, be financially impacted by the scheme, a debt forgiveness campaign group has claimed.

The supreme court case, called Nebraska v Biden, that will decide the fate of Joe Biden’s student loan forgiveness plan rests on one of the plaintiffs, Missouri’s state attorney general, who claims MOHELA – the Higher Education Loan Authority of the State of Missouri – will financially impact his state for the worse.

The Student Debt Collective, an organization that fights financial exploitation and unjust debts, along with the liberal think tank The Roosevelt Institute, submitted a Freedom of Information Act request to make public documents that refute MOHELA’s claim they will suffer financial consequences as a result of the plan.

Internal emails containing company calculations reveal that even after the debt cancellation is enacted, MOHELA would not lose revenue. In fact, the opposite would be true, the groups said. “After President Biden’s proposal is enacted, MOHELA’s direct loan revenue will actually be larger than any prior point in the company’s existence,” the activist groups wrote in a statement.

One internal company document, called the “Forgiveness Impact Summary”, outlines what would happen if the loan forgiveness plan was enacted.

Figures from August 2022 show that if $20,000 of student loans for Pell Grant recipients and $10,000 of student loans per every other borrower were forgiven, MOHELA would still earn over $96m in revenue from servicing direct loans, compared to $88.9m in revenue in 2022 – a 9% increase.

The Student Debt Collective and The