The 8th U.S. Circuit Court of Appeals granted a motion on Friday to temporarily block President Biden’s student loan handout plan.
The appeals court ruled in favor of six Republican-led states who requested that Biden’s handout plan is halted while the court works through its request for an injunction.
Biden’s plan, which aims to cancel up to $20,000 in student loan debt for Pell Grant recipients in college and up to $10,000 for others who borrowed using federal student loans.
Qualifications for the handout include having an adjusted gross income of less than $125,000 individually, and less than $250,000 if married.
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The decision by the appeals court comes just days after the White House released the online application for the handout.
President Biden said that the application portal took over 8 million applications without any problems during its testing period, which was last weekend.
In response to the decision by the appeals court, White House Press Secretary Karine Jean-Pierre said that the Biden administration will move “full speed ahead” in its preparations while complying with the order.
“We will continue to move full speed ahead in our preparations in compliance with this order. And, the Administration will continue to fight Republican officials suing to block our efforts to provide relief to working families,” Jean-Pierre said. “Tonight’s temporary order does not prevent borrowers from applying for student debt relief at studentaid.gov – and we encourage eligible borrowers to join the nearly 22 million Americans whose information the Department of Education already has. It also does not prevent us from reviewing these applications and preparing them for transmission to loan servicers.”
“It is also important to note that the order does not reverse the trial court’s dismissal of the case, or suggest that the case has merit. It merely prevents debt from being discharged until the court makes a decision,” she added.
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“As millions of people fill out the application, we’re going to make sure the system continues to work as smoothly as possible so that we can deliver student loan relief for millions of Americans as quickly and as efficiently as possible,” Biden said.
President Biden spoke about the student loan handout at Delaware State University on Friday.
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“Our student loan plan lowers costs for Americans as they recover from the pandemic to give everybody a little more breathing room. I want to be clear who’s going to benefit most Working people. Middle class folks,” Biden said. “More than 40 million Americans stand to benefit from this relief.
This is a developing story. Fox Buisiness’ Aislinn Murphy and Reuters contributed to this report.