{"id":36282,"date":"2022-11-03T03:29:52","date_gmt":"2022-11-03T03:29:52","guid":{"rendered":"http:\/\/www.brandon.ddtest.info\/multisite-test\/loan-company-distances-itself-from-gop-led-states-student-debt-suit\/"},"modified":"2022-11-03T03:29:52","modified_gmt":"2022-11-03T03:29:52","slug":"loan-company-distances-itself-from-gop-led-states-student-debt-suit","status":"publish","type":"post","link":"http:\/\/www.brandon.ddtest.info\/multisite-test\/loan-company-distances-itself-from-gop-led-states-student-debt-suit\/","title":{"rendered":"Loan company distances itself from GOP-led states\u2019 student debt suit"},"content":{"rendered":"<p> \n<\/p>\n<div>\n<div class=\"wpds-c-grBDNq hide-for-print mb-sm undefined\">\n<div class=\"PJLV PJLV-iAjpuP-css flex items-center\" config=\"[object Object]\" data-qa=\"article-actions\">\n<div class=\"wpds-c-fLphcs\">\n<div class=\"wpds-c-jmLDag wpds-c-jmLDag-bywHgD-variant-primary wpds-c-jmLDag-biynoz-density-compact wpds-c-jmLDag-hZSyid-isOutline-true wpds-c-jmLDag-ejCoEP-icon-left wpds-c-jmLDag-futxca-cv wpds-c-jmLDag-iknmtxO-css\"><button aria-label=\"Comment\" class=\"PJLV PJLV-iPnDcc-css\"><svg xmlns=\"http:\/\/www.w3.org\/2000\/svg\" viewbox=\"0 0 16 16\" fill=\"currentColor\" aria-hidden=\"true\" focusable=\"false\" role=\"img\" class=\"wpds-c-kKAfCG wpds-c-efqEZa focus-highlight flex items-center justify-center brad-lg pointer transition-400 ease-in-out transition-colors\" aria-label=\"Comment on this story\"><title>Comment on this story<\/title><path d=\"M14 14V2H2v9.47h8.18L12.43 13ZM3 10.52V3h10v9.23l-2.5-1.66Z\"\/><\/svg><\/button><\/p>\n<p>Comment<\/p>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n<div class=\"teaser-content grid-center\">\n<div class=\"article-body\" data-qa=\"article-body\">\n<p data-qa=\"drop-cap-letter\" data-el=\"text\" class=\"wpds-c-cYdRxM wpds-c-cYdRxM-iPJLV-css font-copy\">A student loan servicer cited in a lawsuit that temporarily blocked President Biden\u2019s debt forgiveness plan is distancing itself from one of the claims raised by six Republican-led states challenging the program.<\/p>\n<\/div>\n<div class=\"article-body\" data-qa=\"article-body\">\n<p data-qa=\"drop-cap-letter\" data-el=\"text\" class=\"wpds-c-cYdRxM wpds-c-cYdRxM-iPJLV-css font-copy\">The states \u2014 Arkansas, Iowa, Kansas, Missouri, Nebraska and South Carolina \u2014 <a href=\"https:\/\/www.washingtonpost.com\/us-policy\/2022\/09\/29\/republicans-student-loan-forgiveness-lawsuit\/?itid=lk_inline_manual_10&amp;itid=lk_inline_manual_4\" target=\"_blank\" rel=\"noopener\">claim<\/a> that the president overstepped his authority in creating the forgiveness plan and that the move threatened the revenue of state entities that profit from federal student loans, including the Missouri Higher Education Loan Authority. The quasi-state entity commonly known as MOHELA is not a named party to the lawsuit but nonetheless drew the ire of advocacy groups and Rep. Cori Bush (D-Mo.), who questioned its perceived involvement.<\/p>\n<\/div>\n<\/div>\n<div class=\"article-body\" data-qa=\"article-body\">\n<p data-qa=\"drop-cap-letter\" data-el=\"text\" class=\"wpds-c-cYdRxM wpds-c-cYdRxM-iPJLV-css font-copy\">On Tuesday, Justice Department attorneys alerted the U.S. Court of Appeals for the 8th Circuit <b>\u2014 <\/b>which is weighing an injunction against the forgiveness plan <b>\u2014<\/b> to a <a href=\"https:\/\/bush.house.gov\/imo\/media\/doc\/letter_to_hon_cori_bush.pdf\" target=\"_blank\" rel=\"noopener\">letter<\/a> MOHELA sent Bush last week clarifying that it played no role in the decision by Missouri Attorney General Eric Schmitt (R) to sue.<\/p>\n<\/div>\n<div class=\"article-body\" data-qa=\"article-body\">\n<p data-qa=\"drop-cap-letter\" data-el=\"text\" class=\"wpds-c-cYdRxM wpds-c-cYdRxM-iPJLV-css font-copy\">\u201cThe only communications between MOHELA and [the Missouri attorney general\u2019s office] as it relates to student debt relief, is that the Office recently filed a series of sunshine law requests on MOHELA seeking copies of documents relative to MOHELA\u2019s federal loan servicing contract,\u201d the company wrote in its letter to Bush.<\/p>\n<\/div>\n<div class=\"article-body\" data-qa=\"article-body\">\n<p data-qa=\"drop-cap-letter\" data-el=\"text\" class=\"wpds-c-cYdRxM wpds-c-cYdRxM-iPJLV-css font-copy\">The lawsuit filed by Schmitt and leaders in the other five states said MOHELA, which owns and services debt from the defunct Federal Family Education Loan program, would be deprived of interest payments if borrowers consolidated out of FFEL to take advantage of Biden\u2019s<b> <\/b>forgiveness<b> <\/b>plan. It said the company, which funds state scholarships, would also lose revenue from servicing Direct Loans \u2014 those made and owned by the federal government \u2014 that are wiped away.<\/p>\n<\/div>\n<div class=\"article-body\" data-qa=\"article-body\">\n<p data-qa=\"drop-cap-letter\" data-el=\"text\" class=\"wpds-c-cYdRxM wpds-c-cYdRxM-iPJLV-css font-copy\">Bush had asked MOHELA whether the company is supporting efforts to block Biden\u2019s plan to preserve its profits. In response, MOHELA said it is \u201cfaithfully fulfilling its obligations pursuant to its federal loan servicing contract.\u201d<\/p>\n<\/div>\n<div class=\"article-body\" data-qa=\"article-body\">\n<p data-qa=\"drop-cap-letter\" data-el=\"text\" class=\"wpds-c-cYdRxM wpds-c-cYdRxM-iPJLV-css font-copy\">The company said it is \u201ca public instrumentality of the state. As a governmental entity it does not have shareholders and does not exist to make profits. Any available funds above reasonable operating needs and reserves are devoted by MOHELA to student financial aid.\u201d<\/p>\n<\/div>\n<div class=\"article-body\" data-qa=\"article-body\">\n<p data-qa=\"drop-cap-letter\" data-el=\"text\" class=\"wpds-c-cYdRxM wpds-c-cYdRxM-iPJLV-css font-copy\">In their <a href=\"https:\/\/storage.courtlistener.com\/recap\/gov.uscourts.moed.198213\/gov.uscourts.moed.198213.31.0.pdf\" target=\"_blank\" rel=\"noopener\">case<\/a>, the states argued that Missouri had a right to sue on MOHELA\u2019s behalf because it \u201cperforms \u2018an essential <i>public<\/i> function\u2019\u201d and \u201cits board is comprised of public officials and people appointed by the governor.\u201d<\/p>\n<\/div>\n<div class=\"article-body\" data-qa=\"article-body\">\n<p data-qa=\"drop-cap-letter\" data-el=\"text\" class=\"wpds-c-cYdRxM wpds-c-cYdRxM-iPJLV-css font-copy\">U.S. District Judge Henry E. Autrey, who dismissed the states\u2019 case for lack of standing, <a href=\"https:\/\/www.washingtonpost.com\/education\/2022\/10\/20\/student-loan-forgiveness-lawsuit-rejected\/?itid=lk_inline_manual_17\" target=\"_blank\" rel=\"noopener\">questioned<\/a> that premise. Autrey said that while the governor does appoint five members of the company\u2019s board, its revenue and liabilities are independent of the state.<\/p>\n<\/div>\n<div class=\"article-body\" data-qa=\"article-body\">\n<p data-qa=\"drop-cap-letter\" data-el=\"text\" class=\"wpds-c-cYdRxM wpds-c-cYdRxM-iPJLV-css font-copy\">The states appealed, sending it to the 8th circuit. The court issued <a href=\"https:\/\/www.washingtonpost.com\/education\/2022\/10\/21\/student-loan-forgiveness-temporary-stay\/?itid=lk_inline_manual_19\" target=\"_blank\" rel=\"noopener\">an administrative stay<\/a> last month temporarily barring the Education Department from discharging any debt under the new forgiveness program.<\/p>\n<\/div>\n<div class=\"article-body\" data-qa=\"article-body\">\n<p data-qa=\"drop-cap-letter\" data-el=\"text\" class=\"wpds-c-cYdRxM wpds-c-cYdRxM-iPJLV-css font-copy\">Until now, MOHELA has remained silent on the states\u2019 lawsuit. The company did not respond to requests for further comment on Wednesday.<\/p>\n<\/div>\n<div class=\"article-body\" data-qa=\"article-body\">\n<p data-qa=\"drop-cap-letter\" data-el=\"text\" class=\"wpds-c-cYdRxM wpds-c-cYdRxM-iPJLV-css font-copy\">MOHELA is the primary servicer for borrowers pursuing Public Service Loan Forgiveness, a federal program for teachers, firefighters and other public servants. The company services roughly $59 billion in federal direct loans as well as loans from the defunct FFEL program, according to court filings.<\/p>\n<\/div>\n<div class=\"article-body\" data-qa=\"article-body\">\n<p data-qa=\"drop-cap-letter\" data-el=\"text\" class=\"wpds-c-cYdRxM wpds-c-cYdRxM-iPJLV-css font-copy\">In the wake of the states\u2019 lawsuit, the American Federation of Teachers and the nonprofit Student Borrowers Protection Center last month sent MOHELA a <a href=\"https:\/\/protectborrowers.org\/wp-content\/uploads\/2022\/10\/FINAL-Demand-Letter-to-MOHELA-630pm.pdf\">cease-and-desist letter<\/a>. The group\u2019s accused the company of violating California\u2019s Student Borrower Bill of Rights, which prohibits student loan servicers from interfering with borrowers\u2019 rights to loan forgiveness. The Student Borrowers Protection Center said it was prepared to take legal action if the company failed to stand down on the lawsuit.<\/p>\n<\/div>\n<div class=\"article-body\" data-qa=\"article-body\">\n<p data-qa=\"drop-cap-letter\" data-el=\"text\" class=\"wpds-c-cYdRxM wpds-c-cYdRxM-iPJLV-css font-copy\">On Wednesday, SBPC executive director Mike Pierce said: \u201cIt appears that these states just got caught misleading a federal appellate court in a ham-fisted effort to score political points against the president. This is the clearest sign yet that the right-wing state challenge to student debt relief has no legal basis and will prove fruitless in the end.\u201d<\/p>\n<\/div>\n<section class=\"dn-ns hide-for-print\" data-testid=\"mostRead\" subscriptions-section=\"content\"\/><\/div>\n\n<br \/><a href=\"https:\/\/news.google.com\/__i\/rss\/rd\/articles\/CBMiXGh0dHBzOi8vd3d3Lndhc2hpbmd0b25wb3N0LmNvbS9lZHVjYXRpb24vMjAyMi8xMS8wMi9tb2hlbGEtc3R1ZGVudC1sb2FuLWZvcmdpdmVuZXNzLWxhd3N1aXQv0gEA?oc=5\">Source link <\/a><\/p>\n","protected":false},"excerpt":{"rendered":"<p>Comment on this story Comment A student loan servicer cited in a lawsuit that temporarily blocked President Biden\u2019s debt forgiveness plan is distancing itself from one of the claims raised by six Republican-led states challenging the program. The states \u2014 Arkansas, Iowa, Kansas, Missouri, Nebraska and South Carolina \u2014 claim that the president overstepped his &hellip;<\/p>\n","protected":false},"author":1,"featured_media":36283,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":[],"categories":[161],"tags":[],"_links":{"self":[{"href":"http:\/\/www.brandon.ddtest.info\/multisite-test\/wp-json\/wp\/v2\/posts\/36282"}],"collection":[{"href":"http:\/\/www.brandon.ddtest.info\/multisite-test\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"http:\/\/www.brandon.ddtest.info\/multisite-test\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"http:\/\/www.brandon.ddtest.info\/multisite-test\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"http:\/\/www.brandon.ddtest.info\/multisite-test\/wp-json\/wp\/v2\/comments?post=36282"}],"version-history":[{"count":0,"href":"http:\/\/www.brandon.ddtest.info\/multisite-test\/wp-json\/wp\/v2\/posts\/36282\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"http:\/\/www.brandon.ddtest.info\/multisite-test\/wp-json\/wp\/v2\/media\/36283"}],"wp:attachment":[{"href":"http:\/\/www.brandon.ddtest.info\/multisite-test\/wp-json\/wp\/v2\/media?parent=36282"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"http:\/\/www.brandon.ddtest.info\/multisite-test\/wp-json\/wp\/v2\/categories?post=36282"},{"taxonomy":"post_tag","embeddable":true,"href":"http:\/\/www.brandon.ddtest.info\/multisite-test\/wp-json\/wp\/v2\/tags?post=36282"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}