Federal judge in Fort Worth strikes down Biden loan-forgiveness plan

Debt consolidation through a personal loan makes sense if you can qualify for a new loan at a lower rate and you have a plan to pay off what you owe. (iStock)

A U.S. judge in Texas on Thursday blocked President Joe Biden's plan to provide millions of borrowers with up to $20,000 apiece in federal student-loan forgiveness.

District Court Judge Mark Pittman, an appointee of former President Donald Trump based in Fort Worth, said the program usurped Congress' power to make laws. 

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The debt forgiveness plan would cancel $10,000 in student loan debt for those making less than $125,000 or households with less than $250,000 in income. Pell Grant recipients, who typically demonstrate more financial need, would get an additional $10,000 in debt forgiven.

The cancellation applies to federal student loans used to attend undergraduate and graduate school, along with Parent Plus loans.