When the Biden administration announced in August that it was canceling up to $20,000 in student loan debt per borrower, it said the idea was to provide families with “breathing room as they prepare to start repaying loans after the economic crisis brought on by the pandemic.” But two federal courts recently blocked President Joe Biden’s student loan relief program, ruling it unconstitutional. This article explains why and what’s next for student loan borrowers still hopeful their loans can be forgiven.

It was found to be unconstitutional. That determination was made Nov. 10 by Judge Mark Pittman of the U.S. District Court of Northern Texas, who ruled that the Higher Education Relief Opportunities for Students Act of 2003 — or Heroes Act — “does not provide the executive branch clear congressional authorization” for a student loan forgiveness program. He said further that the program was “an unconstitutional exercise of Congress’s legislative power and must be vacated.”

The judge’s ruling prevents any student loans from being forgiven “until a final verdict is made” in the case. Technically it could go to the Supreme Court, but it may also be settled at the appellate court level.

In a separate case, on Nov. 14, a three-judge panel with the United States Court of Appeals for the 8th Circuit temporarily blocked the program until the case is resolved in court.

Both rulings effectively block Biden’s plan to forgive up to $20,000 in student loans per borrower.

Both court decisions could be reversed. The Biden administration has argued that the Heroes Act of 2003 allows the Secretary of Education to forgive student loans for people affected by the pandemic.

The Biden administration has already filed a notice to appeal the Nov. 10 ruling.

On Nov, 18, the Biden administration asked the Supreme Court to vacate the order by the Court of Appeals blocking student loan forgiveness. The Supreme Court has asked the plaintiffs in the case to provide their response by Nov. 23.

It is unclear how the full court might rule. However, in two previous instances, Justice Amy Coney Barrett has shot down attempts to block the student loan forgiveness plan.

Currently, student loan payments are paused but were scheduled to start again in January 2023. On Tuesday, President Joe Biden announced that his administration would extend the pandemic-era pause in student loan repayments through June 30.

Some borrowers may qualify for one or more targeted student loan forgiveness programs.

In November 2022, the Biden administration released new rules to make it easier for student loans to be discharged in bankruptcy. If a student loan borrower can prove their expenses are equal to or greater than their income, the student loan debt may qualify to be eliminated in bankruptcy.

William Chittenden is a professor of finance at Texas State University.

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