U.S. stops taking student debt forgiveness applications after ruling

By Nate Raymond

(Reuters) -The United States government has stopped taking applications for student debt relief, after a federal judge blocked President Joe Biden's loan forgiveness plan, according to a notice on a government website.

A judge in Texas who was appointed by former President Donald Trump ruled on Thursday that Biden's plan to cancel hundreds of billions of dollars in student loan debt was unlawful and must be vacated. The Biden administration is appealing the ruling.

"Courts have issued orders blocking our student debt relief program. As a result, at this time, we are not accepting applications. We are seeking to overturn those orders. If you've already applied, we'll hold your application," the notice says.

About 26 million Americans have applied for student loan forgiveness, and the U.S. Department of Education has already approved requests from 16 million.

The appeal would be heard initially by a three-judge panel of the New Orleans-based 5th U.S. Circuit Court of Appeals, a court dominated by conservative judges who have stymied other Biden policies.

Of the court's 16 active judges, only four were appointed by Democratic presidents. Trump appointed six of them.

White House Press Secretary Karine Jean-Pierre said Thursday the department would hold onto application information "so it can quickly process their relief once we prevail in court."

U.S. District Judge Mark Pittman, an appointee of former Republican President Donald Trump in Fort Worth, called the program an "unconstitutional exercise of Congress's legislative power" by Biden as he ruled in favor of two borrowers backed by a conservative advocacy group.

The litigation could ultimately wind up at the U.S. Supreme Court. Conservative Justice Amy Coney Barrett has already turned back two requests to block the program in lawsuits out of Indiana and Wisconsin, two states she is assigned to assess emergency appeals from.

(Reporting by Juby Babu in Bengaluru and Nate Raymond in Boston. Editing by Heather Timmons, Chizu Nomiyama and Aurora Ellis)

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