Sen. Mike Lee, R-Utah, talks on “Kudlow” about Biden’s student loan relief plan and his handling of the border crisis.
Seven Republican-led states have filed a lawsuit challenging the Biden administration’s latest student loan debt forgiveness plan, accusing the U.S. Department of Education (DOE) of taking steps to forgive loan payments starting as early as this week.
The lawsuit was filed about a week after the Supreme Court rejected the Biden administration’s request to lift a block on the Savings for a Valuable Education (SAVE) plan, which aims to ease the burden on millions of student loan debtors.
In a lawsuit filed Tuesday in federal court in Brunswick, Georgia, attorneys general from Republican-led states including Georgia and Missouri targeted rules proposed in April by the Education Department that would have provided for the forgiveness of federal student loan debt for about 27.6 million borrowers.
The lawyers allege in their lawsuit that they recently obtained documents showing that the Energy Department instructed federal loan servicing companies to begin canceling hundreds of billions of dollars in loans as early as Tuesday or Saturday, before the rules were finalized.
President Biden spoke at an event in Madison, Wisconsin. (Daniel Steinle/Bloomberg via Getty Images/Getty Images)
Lawyers say the order could result in at least $73 billion in loans being wiped out overnight and could relieve billions more of debt.
The lawyers argue that the Department of Education does not have the authority to forgive student loan debt.
“We were successful in stopping the first two illegal student loan forgiveness schemes and are confident we can stop the third,” Missouri Attorney General Andrew Bailey said in a statement.
Missouri Attorney General Andrew Bailey said the Department of Education does not have the authority to forgive student loan debt. (Bill Clark/CQ-Roll Call, Inc via Getty Images/Getty Images)
In addition to Missouri and Georgia, the states of Alabama, Arkansas, Florida, North Dakota and Ohio have also joined the lawsuit.
FOX Business has reached out to the White House and the Department of Energy.
It’s the latest legal challenge to President Biden’s efforts to fulfill a campaign promise and relieve debt for millions of Americans who used federal student loans to pay for the high costs of higher education.
In his previous effort, Biden introduced SAVE after the Supreme Court struck down a student loan forgiveness proposal. The White House The SAVE Plan would reduce borrowers’ monthly payments to zero, cut monthly costs in half and provide savings for borrowers who pay more than $1,000 per year, plus borrowers with initial balances of $12,000 or less would have the remaining balance forgiven after 10 years of payments.
With college students across the country graduating with huge debts, advocates held handwritten signs on the Ellipse in front of the White House in June, calling on President Joe Biden to sign an executive order to cancel student loan forgiveness. (Paul Morigi/Getty Images, We The 45 Million/Courtesy of Getty Images)
A lawsuit from Republican-led states temporarily halted the program until the case was resolved. A preliminary injunction was issued Block the SAVE student loan repayment plan.
The blockage prevents the DOE from proposing a plan while the litigation continues.
Meanwhile, borrowers enrolled in the SAVE Plan are moving into payment forgiveness while the Biden administration defends the plan in court.
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The administration’s appeal is separate from a lawsuit filed by Alaska and other states in a different appeals court challenging the income-linked SAVE Act.
An emergency request for an injunction to block the student loan forgiveness plan in the case is also pending before the Supreme Court.
Reuters contributed to this report.
