Republican States Challenge Biden's New Student Debt Plan in Court

Seven Republican-led states have filed a lawsuit against the Biden administration's latest student debt forgiveness plan. The lawsuit follows the Supreme Court's recent rejection of an earlier debt relief plan. State attorneys general argue that the U.S. Department of Education lacks the authority to cancel billions in student loans.

Seven Republican-led states filed a lawsuit on Tuesday to challenge the Biden administration's latest student debt forgiveness plan. The states argue that the U.S. Department of Education is prematurely moving to cancel loans without proper authority.

This legal move comes shortly after the Supreme Court rejected a different debt relief scheme supported by the administration. The current lawsuit, filed in federal court in Brunswick, Georgia, targets a rule from April aimed at waiving federal student loan debts for approximately 27.6 million borrowers.

The plaintiffs claim the Education Department has instructed loan servicers to cancel billions in loans before the rule is finalized, potentially leading to over $73 billion in cancellations. The Education Department and White House have yet to comment on the lawsuit.

(With inputs from agencies.)