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Biden lays out "new path" for student loan relief after Supreme Court decision
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Date:2025-04-12 21:55:30
Washington — President Biden laid out what steps his administration plans to take after the Supreme Court struck down his student loan relief program in a 6-3 decision that upended a key campaign promise, vowing to continue pursuing debt forgiveness through "a new path" that is "legally sound."
The president insisted he "didn't give any false hope" to borrowers through his now-defeated plan, which would have forgiven up to $20,000 in federal student loan debt. Instead, the president said the court "misinterpreted the Constitution," and blamed Republicans for suing over the program and for voting against it in Congress.
"What I did, I thought was appropriate, and was able to be done and would get done," the president told reporters after remarks at the White House. "I didn't give borrowers false hope, but the Republicans snatched away the hope that they were given."
It was the second time in as many days that the president was forced to react to a defeat handed down by the high court. On Thursday, the justices ruled that the race-conscious affirmative action admission policies of Harvard College and the University of North Carolina are unconstitutional.
But this time, the court overturned against a policy that Mr. Biden himself promised and unilaterally executed. Last August, the president and Education Secretary Miguel Cardona announced the administration would forgive $10,000 in student loans for those earning less than $125,000 annually, and another $10,000 in student loans for those who attended college on Pell Grants. The promise of relief was immediately challenged in court, eventually working its way up to the Supreme Court, where it was struck down Friday.
Speaking from the White House Friday afternoon, the president told borrowers he isn't backing down.
"Today's decision has closed one path," Mr. Biden said. "Now, we're going to pursue another. I'm never going to stop fighting for you. We'll use every tool at our disposal to get you the student debt relief you need to reach your dreams."
The president announced he's directed Education Secretary Miguel Cardona to start a process under a law known as the Higher Education Act to forgive loans "compromise, waive or release loans under certain circumstances." The administration is also rolling out a 12-month "on-ramp repayment program" when student loan payments resume in the fall after being paused during the pandemic. Beginning Oct. 1 and lasting for a year, the Department of Education won't refer borrowers who miss payments to credit agencies or consider them delinquent, the White House said.
"I'm announcing today a new path consistent with today's ruling to provide student debt relief to as many borrowers as possible as quickly as possible. We will ground this new approach in a different law than my original plan, the so-called Higher Education Act," Mr. Biden said. "This new path is legally sound. It's going to take longer, but in my view it's the best path that remains to providing as many borrowers as possible with debt relief."
Additionally, Mr. Biden announced a new income-based repayment plan for federal loans, dubbed the "Saving on a Valuable Education," or SAVE, plan. Under the program, monthly payments for undergraduate loans are limited to 5% of income, cut in half from their current level of 10%. He also shortened the amount of time needed to forgive loans of less than $12,000, to 10 years of payments instead of 20 years, according to the White House.
"I know there are millions of Americans, millions of Americans in this country who feel disappointed and discouraged or even a little bit angry about the court's decision today on student debt," the president said Friday. "And I must admit, I do, too."
The White House said nearly 90% of the relief from the now-defeated plan would have gone to borrowers making less than $75,000 a year, and none of it would have gone to those earning more than $125,000. It would have come with a price tag of roughly $430 billion of dollars.
The court's decision, which fell along ideological lines, presented not just a setback for student loan holders, but also for Mr. Biden's reelection efforts. In 2020, he campaigned on canceling student loan debt, which he was ultimately unable to deliver.
- In:
- Supreme Court of the United States
- Joe Biden
- Student Loans
Kathryn Watson is a politics reporter for CBS News Digital based in Washington, D.C.
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