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The Supreme Court denied a request to halt a $6 billion settlement for student loan debt

By: April Carson

The Supreme Court refused to delay a $6 billion settlement for the student loan debt, allowing the settlement to take effect. The settlement is being used to provide relief for borrowers who have been struggling with expensive loans and high-interest rates. This decision is a huge victory for those in financial hardship and millions of Americans carrying student loan debt.

The Supreme Court has declined to block a settlement that will result in the cancellation of thousands of student loan debts. This settlement will now go into effect.

The colleges' request challenging the settlement was rejected by the Supreme Court in a brief order. It's worth noting that this case and President Joe Biden's ongoing effort to forgive student loan debt are two separate matters before the Supreme Court, and a ruling on the matter is expected within the next two months.

The $6 billion settlement will provide financial relief to current and former students of Corinthian Colleges. It's estimated that approximately 350,000 borrowers are eligible for debt forgiveness due to the settlement.

The settlement is about loans taken out by borrowers who believe they were misled by their for-profit schools. The borrowers are seeking their loans to be canceled. The value of the settlement is potentially over $6 billion.

This situation stems from a settlement that was approved by U.S. District Judge William Alsup in November. The settlement was in a case brought by borrowers, and the government has already begun implementing it.

The Supreme Court's decision not to halt the settlement is a huge win for current and former Corinthian College students.

Everglades College, Lincoln Educational Services Corp., and American National University have applied to Supreme Court. Lincoln and American National are for-profit entities, whereas Everglades is not-for-profit. All three organizations run colleges that the federal government has included on a list of over 150 institutions associated with allegations of "significant misconduct."

The colleges dispute that statement. According to the Justice Department, out of all the affected loans, about 3,800 belong to the three colleges mentioned and only 400 of them have been forgiven so far.

Challengers are arguing that Education Secretary Miguel Cardona has overstepped his authority under the federal Higher Education Act, which only allows for debt cancellations in certain circumstances. They claim that his authority does not extend to the power to mass-cancel all student loans in the US.

However, the Supreme Court has decided that it is not necessary to issue a stay on the settlement while the legal challenge is working its way through the court system.

The request was made to the Supreme Court to pause Alsup's ruling and review the case quickly.

According to the Justice Department, which represents Cardona, the settlement only pertains to borrowers and the Education Department. Therefore, it does not make any legal decisions or place obligations or responsibilities on the schools in question. The government lawyers claim that there is no proof that the schools have experienced any harm.

The colleges had requested a delay in the ruling by Alsup, but he declined their request. He explained that being included on the list of colleges did not have any legal impact on their rights.

In 2019, a lawsuit was filed regarding the collapse of Corinthian Colleges, a for-profit organization that resulted in thousands of borrowers seeking debt relief. The Supreme Court showed doubt in the legality of Biden's debt relief plan in separate cases, which involved larger sums of debt.

The denial of the halt on the $6 billion settlement is a huge win for student loan borrowers. As the Biden administration aims to provide relief for borrowers, this case shows that their efforts will not be easily blocked by appeals from colleges.

Since October, the $20,000 debt cancellation program for eligible borrowers has been blocked due to a temporary hold by the 8th U.S. Circuit Court of Appeals. There are doubts about whether the program will ever be implemented.

The proposed plan is wider in scope than the class-action settlement and would impact over 40 million borrowers with a cost exceeding $400 billion.

The Biden administration must now rely on Congress to pass legislation that would make the debt cancellation plan a reality. The alternative is for the Supreme Court to overturn the lower court’s ruling and allow the program to proceed, or for it upholds the decision and leaves it up to Congress to decide.

This has been a long battle between student loan advocates and the Department of Education. Supporters of the settlement say that it is necessary to provide relief for debt-burdened individuals who have struggled during the pandemic. They also argue that forgiving this debt would help stimulate the economy.

Billy Carson’s Inspiration Behind 4biddenknowledge Inc. Interviewed by Lis Hoekstra


April Carson is the daughter of Billy Carson. She received her bachelor's degree in Social Sciences from Jacksonville University, where she was also on the Women's Basketball team. She now has a successful clothing company that specializes in organic baby clothes and other items. Take a look at their most popular fall fashions on

To read more of April's blogs, check out her website! She publishes new blogs on a daily basis, including the most helpful mommy advice and baby care tips! Follow on IG @bossbabymav



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