NNI - Court keeps block on Biden's student loan debt forgiveness in place

A U.S. appeals court has kept a block on President Joe Biden's administration plan to cancel hundreds of billions of dollars in student loan debt, Reuters reported Monday, citing a court filing.

In the case six Republican-led states sought to stop the program to erase the debt on the grounds that the White House's plan averted congressional authority and would impact the states' future tax revenue and money earned by state entities that invest in or service student loans.

A U.S District Judge Henry Autrey in St. Louis dismissed the states' case on Oct. 20, saying they lacked legal standing. The states — Nebraska, Missouri, Arkansas, Iowa, Kansas, and South Carolina — are appealing the decision, Reuters said. On Oct. 21, the Federal appeals court issued a stay to temporarily block the student loan forgiveness plan from taking effect.

Stocks that can be affected by the cancellation of the loans include SoFI Technologies ( NASDAQ: SOFI ) -0.6% , Navient ( NASDAQ: NAVI ), +0.6% , Nelnet ( NYSE: NNI ), +0.7% ,  and SLM ( NASDAQ: SLM ), -2.4% .

Last week, a Texas District Court judge has also blocked the program. In September, the Congressional Budget Office estimated that the action to cancel up to $10K per student loans per borrower and up to $20K for Pell Grant recipients will cost the government ~$400B.

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