The Department of Education sent out emails over the weekend notifying some borrowers that their student loan forgiveness applications had been approved despite several pending legal challenges.
The emails read: “We have reviewed your application and determined that you are eligible for loan relief under the plan. We have forwarded this approval to your credit servicer.”
It continued: “Unfortunately, a number of lawsuits have been filed against the program which are currently preventing us from paying your debt. We firmly believe the lawsuits are without merit and the Department of Justice has appealed on our behalf. Your application is complete and approved, and we will pay your approved debts if and when we prevail in court.”
The email also told borrowers that they did not need to take any further action.
Currently, President Joe Biden’s debt relief program has been halted after multiple lawsuits challenged the program.
“This could take a little time and unfortunately it could leave borrowers in limbo knowing if they will receive forgiveness, how much forgiveness and the financial planning process in the new year,” said attorney Leslie Tayne.
Financial attorney and student loan debt expert Leslie Tayne says there’s no way to estimate how long it might take to resolve these issues.
“Ultimately it will be up to the Supreme Court to make that decision, they could ask for oral arguments, they could ask for written arguments, there are a number of options so it’s in limbo and that’s frustrating for borrowers. said Tayne.
Borrowers should keep in mind that the federal student loan payment pause is scheduled to last through the end of the year. Tayne says borrowers should prepare to begin paying down the debt they owe, including debt eligible under Biden’s forgiveness program.
“Plan for it, and if it ends up being extended and you benefit from it, at least you’re prepared,” Tayne said.
Right now, many borrowers we spoke to say they are patiently awaiting forgiveness.
“Our current economic situation, I think they will enforce it,” one borrower told us.
If you haven’t received a letter, don’t worry. The Minister of Education says more will be sent out.
At this time, the Department of Education will not accept new requests for relief until the lawsuits are resolved.