Biden's student debt relief in legal limbo, but advocates urge people to keep applying

While a federal appeals court decision Friday opened the door to a potential setback for President Joe Biden's student debt relief program, legal experts and advocates for loan forgiveness tell ABC News they're not overly concerned, urging people to keep applying.

But borrowers are worried, regardless.

A stay granted by the 8th Circuit Court of Appeals put a temporary pause on discharging loan relief, expected to begin as soon as this week, until judges review a challenge by six GOP-led states to stop the program.

Another ruling, after more detailed hearings, expected later this week, could bring the program to a longer halt and be a big political loss for Biden just before the midterm elections. He's campaigned on his plan that calls for between $10,000 and $20,000 in debt forgiveness for Americans who make below $125,000 a year, or $250,000 as a married couple.

Remaining optimistic, advocates for student debt relief point to other legal challenges thrown out by the courts -- including that a lower court had dismissed this particular lawsuit just before the appeals court issued the temporary stay.

"The most important thing is that people apply for debt relief. Nothing has changed," Mike Pierce, executive director and co-founder of the Student Borrower Protection Center, told ABC News.

"The fact that the application is open, it is simple, it works, it is easy, and the administration is putting the building blocks in place to be able to press the button and cancel everybody's debts as soon as they're able to do so? That was true a week ago. That was true on Friday, and that is true today," he said.

And while Pierce and others are pushing people to apply because there's a fast-approaching deadline of Dec. 31 when the current payment pause ends, it's also a strategy: Advocates hope that the more people who display an interest in the program, the harder it will be for courts to take it away.

"I think it's very important for people to take all the steps they're able to because it does show that people are starting to rely on these promises that the president has made to be able to cancel their debts," Pierce said.

John Brooks, a law professor at Fordham University who focuses on federal fiscal policy, called that more of a political strategy than a legal one, but said it could potentially sway judges.

Brooks predicts the appeals court will focus on whether the GOP-led states have legal standing to claim the harm they allege they'd suffer -- and said the Republican argument on that point is weak.

Based on that, he said, he thinks the Friday stay was only a temporary win and downplays the possibility the appeals court will deal the Biden administration a blow.

Put simply, for opponents of the debt relief program, the stay was "the biggest win so far -- but it's still not much of a win," Brooks said.

The Biden administration, for its part, is pushing full speed ahead. White House press secretary Karine Jean-Pierre wouldn't entertain the idea that the administration might not be able to deliver on this promise, pushed by ABC News in a press briefing.

"It's not going to stop our message. We know that there are opponents out there who don't want us to help middle-class Americans. But it's not going to stop us," Jean-Pierre said.

That's not to say there haven't already been political implications, though.

The legal back-and-forth has made the process confusing and emotionally draining for hopeful borrowers who want their debt relieved, like Cleopatra Melton, a borrower with roughly $50,000 in student loan debt.

Melton could see 40% of that debt wiped out by the program, which cancels up to $20,000 in additional loan forgiveness for those who are also Pell Grant recipients. (Pell Grants themselves usually do not have to be repaid.)

But the stay imposed by the appeals court has poured cold water on her optimism.

"This was just too good to be true because it never has been done," she told ABC News.

"As long as that lawsuit was out there, I didn't want to get too celebratory about it. You know what I mean? So, I'm extremely worried that it's not going to go through," she said.

And though the current challenge was brought by Republicans, it still looks like a setback to Melton -- who said it has political ramifications for Biden.

Melton said she voted for him in 2020 because of his campaign promise of $10,000 in student loan forgiveness for American borrowers, she said. Now, she sees this as yet another example of people of color -- who make up a large percentage of borrowers -- being left behind.

"I feel like no one is worthy of my vote. Honestly speaking, everyone makes all these campaign promises to the Black and the brown and I don't feel like anyone has ever really did anything for me," Melton said.

"I felt like finally someone's doing something that will directly affect me and my children with their campaigning, with the laws, with the rules. And now for this to be blocked there's just -- it's more of the same, to me," she said.

Others, like Brea Govan, 29, feel more hopeful that the court will throw out the lawsuit, as other courts have done over the last few weeks.

Govan, who qualifies for $10,000 in debt relief, recently applied online so her remaining debt of $9,400 would be wiped completely.

"I wish that they wouldn't block it," Govan told ABC News.

"Twenty-two million people have already applied to this and that's almost half of who needs the support. That says a lot," she said.

Of course, even if the Biden administration is victorious, the lawsuit could also slow down the debt relief process, since the administration was expected to start doing so this week but has been put on pause.

That's led advocates to challenge the Biden administration to be open to the idea of extending the moratorium on loan payments once more, past Jan. 1, in order to avoid a messy situation where people need to start making payments on debts again even though their debts should be forgiven.

On Monday, Jean-Pierre wouldn't say whether that's on the table, instead arguing that the Biden administration could still stay on schedule despite the current lawsuit.