Student Loan Forgiveness Applications Approved, But There's a Massive Catch

The first batch of status updates for federal student loan borrowers who applied for President Joe Biden's student loan forgiveness program went out over the weekend.

The borrowers were notified by email that their forgiveness request had been approved and that their servicer had been informed.

No additional action is required from the borrowers, per the letters.

Their debt, however, still needs to be legally dischargeable because of pending lawsuits, according to CNBC.

The letters stated, "Unfortunately, a number of lawsuits have been filed challenging the program, which have blocked our ability to discharge your debt at present. We believe strongly that the lawsuits are meritless, and the Department of Justice has appealed on our behalf."

"Your application is complete and approved, and we will discharge your approved debt if and when we prevail in court," the letters continue. "We will update you when there are new developments."

Lawsuits Cause Confusion Around Student Loan Forgiveness Program

Both the federal courts have blocked President Joe Biden's attempt to cancel the loans. On Thursday, the Department of Justice asked the Supreme Court to review the lower court's decision.

The Supreme Court is expected to rule on whether or not to hear the case on Wednesday, November 23, per Fortune.

The lawsuit has created a confusing web around the canceling program. When Biden originally proposed this broad forgiveness in August, the administration asked borrowers to apply for student loan relief by mid-November.

There will be plenty of time to review the student loan relief applications and give aid before the government restarts loan payments in January.

But due to legal concerns, the implementation date keeps getting delayed. When or if the relief will be allowed to proceed is currently unknown.

Borrowers are now begging Biden to, at the very least, extend the payment suspension once again until the legal concerns are settled.

Others who took out loans during the pandemic are undecided about whether they should sit tight and hope the situation improves or abandon their claims for refunds.

The White House claimed 26 million people had applied for student loan forgiveness before a court ruling shut down the program. More than 16 million applications were successful.

More Student Loan Relief Applicants Will Receive Their Letters Soon

The Biden administration approved 16 million student loan relief applications before the court orders, and those people are now receiving notifications.

Education Secretary Miguel Cardona indicated on Twitter on November 19 that alert emails would be sent to those candidates who did not initially receive the notice.

"Beginning today, applicants and others seeking relief through the Biden-Harris Administration's Student Debt Relief Plan will begin receiving updates. Don't worry if you don't get an email today - more are coming," Cardona said on Twitter.

Ten million more people applied for citizenship but had yet to be approved by the time the court verdicts came down, CBS News noted.

"The Biden administration is in a tough spot right now," said Mike Pierce, Executive Director of the Student Borrower Protection Center. "They aren't allowed to approve applications until something changes in the court."

In addition, the online application that the Education Department had made available before its closure in response to the court judgments needs to be made available, making it difficult for the roughly 14 million eligible borrowers. They still need to apply to do so.

This article is owned by Latin Post.

Written by: Bert Hoover

Watch: Biden Administration To Ask Supreme Court To Reinstate Student Loan Forgiveness Program - From CBS Miami