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Attorney General Josh Stein Defends Targeted Debt Relief for North Carolina’s Student Borrowers

For Immediate Release:
Thursday, January 12, 2023

Contact: Nazneen Ahmed

(RALEIGH) Attorney General Josh Stein filed a friend of the court brief in two cases before the U.S. Supreme Court about the Biden Administration’s targeted cancellation of federal student loan debt to help address COVID-19-related difficulties for borrowers.

“The pandemic put the financial futures of too many of low-income students in real financial jeopardy,” said Attorney General Josh Stein. “We can help give them the relief they need and deserve, and in turn protect our state’s economy. I urge the court to allow the federal government to grant this debt relief on a targeted basis for North Carolina student borrowers.”

Last year, U.S. Secretary of Education Miguel Cardona announced plans to grant $10,000 in debt relief for borrowers under certain income thresholds and $20,000 in debt relief to borrowers who met those income thresholds and also received a Pell Grant in college. This relief will help keep borrowers from defaulting on their loans when the nearly three-year pause on loan repayment ends. The plan was challenged in Biden v. Nebraska and Department of Education v. Brown, and the federal government is now asking the Supreme Court to lift lower courts’ injunctions that blocked the Secretary from granting this debt relief while the cases continue.

Attorney General Stein joins a coalition of 22 attorneys general arguing that the HEROES Act authorizes the Secretary of Education to take this action. The pandemic has caused ongoing financial harm to student borrowers, and evidence shows that pandemic-related defaults are likely to increase when the current student loan repayment pause lifts. These defaults would have terrible impacts on borrowers and on North Carolina’s economy. State economies benefit when their residents can avoid default on student loans and avoid the resulting peril to job prospects, housing, and federal benefits. The coalition of state attorneys general argues that the federal government appropriately granted relief that was targeted to prevent these outcomes.

Attorney General Stein is joined in submitting this brief by the Attorneys General of Massachusetts, California, Connecticut, Colorado, Delaware, the District of Columbia, Hawai‘i, Illinois, Maryland, Michigan, Minnesota, Nevada, New Mexico, New Jersey, New York, Oregon, Pennsylvania, Rhode Island, Vermont, Washington, and Wisconsin.

To find a copy of the brief in full, please click here.