NNI - Federal judge to rule on lawsuit seeking to overturn student loan forgiveness plan
- U.S. District Judge Henry Autrey of St. Louis will rule on the lawsuit filed by six Republican-led states that are seeking to halt the student loan forgiveness plan that President Joe Biden unveiled in August, the Associated Press reported Wednesday.
- Under the plan, $10K of student debt will be forgiven for borrowers who earn less than $125K per year. Pell grant recipients will get up to $20K of loans held by the Department of Education forgiven.
- The Biden administration said it has "broad authority" to manage federal student financial aid programs under the HEROES Act of 2003. Meanwhile, an attorney for the Nebraska attorney general's office, one of the states bringing the suit, told Autrey that the administration is acting outside of its authority and will cost states millions of dollars, the AP reported.
- It's unclear when Autrey will rule on the lawsuit. In whichever way he rules, though, an appeal is likely.
- After the Biden plan was announce, Credit Suisse said student loan forgiveness will impact Navient ( NASDAQ: NAVI ) more than Nelnet ( NYSE: NNI ).
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Federal judge to rule on lawsuit seeking to overturn student loan forgiveness plan