Which states benefit the most from Biden's student loan forgiveness plan? California, Texas

  • In Politics
  • 2023-01-27 15:47:41Z

The Biden administration again called out conservative states for blocking the president's signature plan for student loan debt forgiveness Friday, sharing that hundreds of thousands of borrowers in states challenging the plan were approved for relief before it was blocked by the courts.

Nationwide, about 26 million borrowers applied in the few weeks applications were open last fall, and more than 16 million were approved for relief. But a pair of separate court cases late last year halted the debt forgiveness plan. On a call with reporters, administration officials said Republican leaders in some states were responsible.

"The new data comes as elected officials and opponents of this plan are actively blocking many of their own constituents from getting relief, deciding instead to put special interests first," said Jordan Matsudaira, chief economist at the Education Department.

Student loan borrowers in Washington, D.
Student loan borrowers in Washington, D.  

He specifically referenced Missouri, where about 305,000 borrowers were approved for loan forgiveness. Missouri is among the states that challenged the administration's plan and is home to the national student loan servicer Higher Education Loan Authority of the State of Missouri, more commonly known as MOHELA.

More: Conservative states tell Supreme Court that Biden's student loan relief was a power grab

Impact of student loan debt forgiveness: It will change the lives of some with student loans, but fall short for others.

What happened to the president's plan for mass student loan debt relief?

In August, Biden announced his plan to forgive up to $20,000 in student loan debt for borrowers who make less than $125,000, or $250,000 for married couples.

The plan has since been challenged separately by six conservative states and the Job Creators Network Foundation Legal Action Fund, the latter on behalf of two student loan borrowers who weren't eligible for the full relief under the plan. Both parties have broadly challenged the executive branch's power to cancel student loan debt en masse.

The Biden administration plans to ask the Supreme Court to reinstate the president
The Biden administration plans to ask the Supreme Court to reinstate the president's student debt cancellation plan, according to a legal filing warning that Americans will face financial strain if the plan remains stalled in court when loan payments are scheduled to restart later this year.  

The administration, meanwhile, says a law passed after 9/11 gives the president the authority to forgive student loan debt in connection to national emergencies. The Supreme Court has taken up both cases and will hear arguments in late February. A decision is expected by summer.

What happened to Biden's free college plan? Cutting cost of higher ed out of feds' reach

What happens if the Supreme Court strikes down Biden's student loan forgiveness plan?

When asked by reporters, the administration would not elaborate on whether it had an alternative plan to forgive debt should the Supreme Court strike down its plan.

"We are not deliberating or considering any other kind of alternative approach," said Bharat Ramamurti, deputy director of the National Economic Council. "We're fully committed to the approach that the Education secretary used in this case, and we're confident in our legal authority."

How many borrowers are eligible for relief in states suing the administration to stop the plan? 

  • Arkansas: 144,000

  • Iowa: 169,000

  • Kansas: 143,000

  • Nebraska: 97,000

  • Missouri: 305,000

  • South Carolina: 282,000

Which states have the largest number of eligible borrowers?

These states have the largest number of approved applications, which to an extent correlate with their overall size:

  • California: 1.5 million

  • Texas: 1.4 million

  • Florida: 1 million

  • New York: 1 million

  • Pennsylvania: 743,000

These are the states with the fewest number of approved borrowers, which include some of the nation's least populous states:

  • South Dakota: 46,000

  • Vermont: 33,000

  • North Dakota: 32,000

  • Alaska: 24,000

  • Wyoming: 18,000

Are student loan payments still paused?

Yes, the moratorium on student loan payments could last as long June 30. As part of the freeze, interest rates on student loans have been set at 0%, and collections agencies have stopped their attempts to collect debts.

Contact Chris Quintana at (202) 308-9021 or cquintana@usatoday.com. Follow him on Twitter at @CQuintanadc

This article originally appeared on USA TODAY: Student loan forgiveness: Which states benefit most from Biden's plan?


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