Biden administration sued over student loan payment pause by SoFi

So it's *** trade. Yeah, because it's raining right second. If you're talking about this in the abstract, I think most casual observers would say if you're going to give up that much amount of money if you're going to affect the obligations of that many americans on *** subject that's of great controversy. They would think that's something for Congress to act on. Some of the biggest mistakes in the court's history were deferring to assertions of executive emergency power. Some of the finest moments in the court's history were uh, pushing back against presidential assertions of emergency power. It leaves us with *** situation that I think we've seen before, an old statute general language Congress specifically considering the present issue repeatedly, but not as you acknowledged, passing legislation that would authorize the specific action. And then in the wake of Congress, not authorizing the action, the executive nonetheless doing *** massive new program and that seems problematic to head off immediate harm for student loan borrowers, to secretaries. Across two administrations invoked the heroes act to suspend interest and payment obligations for all americans with federally held loans. But if that forbearance ends without further relief, it's undisputed. That defaults and delinquencies will surge above pre pandemic levels. All we have is an attempt to modify. But this goes far beyond *** modification because it is the creation of *** brand new program that goes far beyond what Congress intended student that has got to go make some noise for me. It's going to mean more than just my education. It's going to be more to my parents who are honestly were quite scared when I wanted to go to UT AuSTIN. They felt like it was unaffordable. Um, but student loans have really helped me, at least, you know, being *** low income student helped me. I would say the older americans to remember that there are people there, young people who simply don't have either. The generational wealth don't have the means, don't have the resources to pay their college in full debt free. And as the cost of college continues to outpace inflation, it's critical that support is given to those people who don't have the means to repay their debt right away.

SoFi, a private lender, sued the Biden administration last week in an effort to end the pause on federal student loan payments that has been in place since March 2020.The pause on payments was originally put in place during the Trump administration to help people struggling due to the COVID-19 pandemic. The moratorium has since been extended eight times, most recently by President Joe Biden in November.In its legal complaint, SoFi argues that the last extension is different and unlawful, partly because the Biden administration tied the restart date to pending litigation over its proposed student loan forgiveness program, which is now before the U.S. Supreme Court.Currently, payments are set to resume 60 days after the Supreme Court issues its ruling or in late August -- whichever comes first. The justices heard oral arguments in the cases over the student loan forgiveness program last week and are expected to release a decision in late June or early July."Unlike the other extensions, the Department (of Education) did not claim that continuing the moratorium was necessary to address harm caused to borrowers affected by the pandemic," reads SoFi's complaint, which was filed in a federal district court in Washington, DC."Instead, the Department asserted that the further extension was intended to alleviate 'uncertainty' for borrowers during the pendency of ongoing litigation regarding the debt-cancellation program," it continues.SoFi is asking the court to end the payment pause, at a minimum for borrowers who would not be eligible for Biden's student loan forgiveness program, which promises up to $20,000 in debt relief for individual borrowers who earn less than $125,000 a year.During the pause, the government has also set interest rates to 0% for federal student loan borrowers. With these benefits, borrowers have little incentive to refinance their loans with a lender like SoFi. The bank says it has already lost more than $6 million due to the eighth extension of the pause.The Department of Education maintains that the pause and the proposed one-time debt cancellation plan are legal."This lawsuit is an attempt by a multi-billion dollar company to make money while they force 45 million borrowers back into repayment -- putting many at serious risk of financial harm," the department said in a statement sent to CNN Tuesday.SoFi is a private bank that refinances federal student loans, offering lower interest rates to borrowers who qualify. The company launched in 2011, at first offering student loan refinancing to only Stanford University graduates. Now, SoFi refinances student loans from borrowers from most colleges and has refinanced over $30 billion in student loans for more than 450,000 borrowers since 2012. It also offers personal loans and mortgages.SoFi projects that it will lose $25 million to $30 million if the payment pause remains in place through August, according to the complaint."We have supported and continue to support targeted student loan forgiveness, in addition to the student loan payment moratorium during the economic crisis at the height of the COVID-19 pandemic. However, it's time for the administration to follow through on its word to end the federal student loan payment moratorium," said SoFi in a statement sent to CNN Tuesday.

SoFi, a private lender, sued the Biden administration last week in an effort to end the pause on federal student loan payments that has been in place since March 2020.

The pause on payments was originally put in place during the Trump administration to help people struggling due to the COVID-19 pandemic. The moratorium has since been extended eight times, most recently by President Joe Biden in November.

In its legal complaint, SoFi argues that the last extension is different and unlawful, partly because the Biden administration tied the restart date to pending litigation over its proposed student loan forgiveness program, which is now before the U.S. Supreme Court.

Currently, payments are set to resume 60 days after the Supreme Court issues its ruling or in late August -- whichever comes first. The justices heard oral arguments in the cases over the student loan forgiveness program last week and are expected to release a decision in late June or early July.

"Unlike the other extensions, the Department (of Education) did not claim that continuing the moratorium was necessary to address harm caused to borrowers affected by the pandemic," reads SoFi's complaint, which was filed in a federal district court in Washington, DC.

"Instead, the Department asserted that the further extension was intended to alleviate 'uncertainty' for borrowers during the pendency of ongoing litigation regarding the debt-cancellation program," it continues.

SoFi is asking the court to end the payment pause, at a minimum for borrowers who would not be eligible for Biden's student loan forgiveness program, which promises up to $20,000 in debt relief for individual borrowers who earn less than $125,000 a year.

During the pause, the government has also set interest rates to 0% for federal student loan borrowers. With these benefits, borrowers have little incentive to refinance their loans with a lender like SoFi. The bank says it has already lost more than $6 million due to the eighth extension of the pause.

The Department of Education maintains that the pause and the proposed one-time debt cancellation plan are legal.

"This lawsuit is an attempt by a multi-billion dollar company to make money while they force 45 million borrowers back into repayment -- putting many at serious risk of financial harm," the department said in a statement sent to CNN Tuesday.

SoFi is a private bank that refinances federal student loans, offering lower interest rates to borrowers who qualify. The company launched in 2011, at first offering student loan refinancing to only Stanford University graduates. Now, SoFi refinances student loans from borrowers from most colleges and has refinanced over $30 billion in student loans for more than 450,000 borrowers since 2012. It also offers personal loans and mortgages.

SoFi projects that it will lose $25 million to $30 million if the payment pause remains in place through August, according to the complaint.

"We have supported and continue to support targeted student loan forgiveness, in addition to the student loan payment moratorium during the economic crisis at the height of the COVID-19 pandemic. However, it's time for the administration to follow through on its word to end the federal student loan payment moratorium," said SoFi in a statement sent to CNN Tuesday.

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