Millions of borrowers mistakenly told they were approved for student loan relief

Emails with a subject line that told millions of borrowers they were approved for debt forgiveness under President Joe Biden’s student loan relief plan were mistakenly sent out by a federal contractor.

Accenture, a contractor for the Department of Education, said these erroneous emails were sent on November 22 and 23. 

“Accenture Federal Services regrets the human error that led to an email being sent to a number for student loan debt relief applicants with an inaccurate subject line,” an Accenture spokesperson said to Fox Television Stations. “Working closely with the Department, Accenture Federal Services is reviewing quality control measures to support accurate and timely communications to applicants in the Student Loan Debt Relief Program.”

Those updates will be sent in the next few days, Fox Station WTTG in Washington, D.C. reported.

The email was sent with the subject line, “Your Student Loan Debt Relief Application Has Been Approved” and stated, “We received your application or have the income information to process you for loan relief. You do not need to take any further action at this time.”

However, the body of the email clarified that student loan forgiveness is still being decided in courts. 

“Unfortunately, a number of lawsuits have been filed challenging the program, which have blocked our ability to discharge your debt at present,” Education Secretary Miguel Cardona said in the email. “We believe strongly that the lawsuits are meritless, and the Department of Justice has appealed on our behalf.” 

Biden’s student loan forgiveness plan aims to erase up to $10,000 in eligible federal student loans and up to $20,000 for Pell Grant recipients. Relief would apply to borrowers who make no more than $125,000 per year if filing single or $250,000 for married couples. However, Biden’s student loan relief plan remains on hold following multiple lawsuits. 

But even if Biden’s proposal clears its legal hurdles, private student loan borrowers won’t benefit from federal relief. If you’re a private student loan borrower, you can potentially refinance your loans into a lower interest rate. Visit Credible to find your personalized interest rate without affecting your credit score.

BIDEN’S STUDENT LOAN FORGIVENESS: A TIMELINE OF LEGAL CHALLENGES FACING THE PLAN 

Supreme court to weigh in on Biden’s student loan forgiveness plan

The Supreme Court in December said it will hear arguments over Biden’s student loan forgiveness plan in February 2023. 

An injunction blocking the administration’s relief plan remains in place, according to a Supreme Court brief. That injunction was issued by the St.Louis-based 8th Circuit Court of Appeals. It follows a lawsuit involving Nebraska, Missouri, Arkansas, Iowa, Kansas and South Carolina.

These six states disagree with the Biden administration’s efforts to justify its student loan forgiveness plan under the Higher Education Relief Opportunities for Students (HEROES) Act of 2003. The Biden administration claims this law gives it the authority to forgive student loan debt as a response to the national emergency of the COVID-19 pandemic. However, the six states call it a false “pretext” to approve widespread student loan relief. 

In a separate lawsuit, a federal judge in Texas blocked Biden’s student loan forgiveness plan, calling it illegal. The New Orleans-based 5th Circuit Court of Appeals rejected the administration’s efforts to lift that block.  

If you hold private student loans, these won’t qualify for any federal loan relief. But you can consider refinancing your loans to a lower interest rate to help you save on your monthly payments. Visit Credible to compare loans from multiple lenders and find one that’s right for you. 

STUDENT LOAN DEFAULTS COULD RISE TO HISTORIC HIGH WITHOUT DEBT RELIEF: EDUCATION DEPARTMENT

Biden administration extends student loan payment pause again

As the fate of the Biden administration’s student loan forgiveness plan remains undecided, the president announced he would extend the federal student loan repayment pause. 

That pause will last through 60 days after June 30, 2023, or after the administration is permitted to follow through on its student debt forgiveness plan, the president announced in a video posted to his official Twitter page. 

The repayment pause is part of a provision in the CARES Act of 2020. It paused payments due on eligible student loans held by the Department of Education and reduced interest rates to 0%. 

If you have private student loans, you won’t qualify for any type of federal student loan relief. But you can lower your monthly payments by refinancing your loans into a lower interest rate. Visit Credible to speak to a student loan refinancing expert and see if this option is right for you. 

STUDENT LOAN REFUND CHECKS ON THEIR WAY TO MILLIONS: HERE’S WHAT TO DO IF YOU DON’T BENEFIT

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