When Stephanie Rodriguez consolidated her federal student loans this spring, she had hoped to enroll in a low-cost repayment plan. But by the time her consolidation was processed in the summer, Rodriguez, 39, faced one hurdle after another.

The plan she was eyeing – President Biden’s Saving on a Valuable Education program – was on hold because of a pair of court orders. Even though Rodriguez could still enroll, the online application was no longer functioning. She called her loan servicer, who explained that they couldn’t even process an application if she filled it out – another consequence of the court orders. There were other income-based repayment programs, but those were also caught up in the legal morass.

Without access to a low-cost plan, Rodriguez would see her monthly student loan bill jump from $10 to $601.

“There is no way I can afford that payment,” said Rodriguez, who graduated from the University of Florida with a journalism degree in 2007. “This is all so confusing and no one is giving me straight answers.”

Rodriguez is one of the millions of borrowers whose loan repayments have been upended by the ongoing legal battle over the Biden administration’s new income-driven plan, known as Save – the latest twist of which came Wednesday when the Supreme Court upheld a temporary pause on the program.

An injunction imposed by the U.S. Court of Appeals for the 8th Circuit earlier this month to halt Save has cast doubt on the Education Department’s ability to forgive loans through all four income-driven plans, some dating back decades. It has made it difficult for borrowers to enroll in those low-cost plans and for loan servicers to process their applications.

In response, the department has postponed the payments of 8 million borrowers in Save and those trying to enroll in other income-driven plans, deferring the collection of billions of dollars in student loan debt.

The 8th Circuit declined last week to clarify the scope of the injunction, leading the Biden administration to petition the Supreme Court to either narrow the order or quickly take up the case itself. On Wednesday, the justices refused the request without explanation but said the court expects the 8th Circuit will weigh the merits of the case and render a decision “with appropriate dispatch.” In the meantime, millions of borrowers are stuck in an untenable position.

A spokesperson for the Education Department said the agency will work to “minimize further harm and disruption to borrowers” as it awaits a final decision from the 8th Circuit.

The appeals court order stems from a lawsuit filed in April by Missouri Attorney General Andrew Bailey and six other Republican-led states that accuse Biden of overstepping his authority with the creation of Save. The plan, which was finalized last fall, provides lower monthly payments and a faster path to loan cancellation, already clearing the balances of 414,000 enrollees who borrowed less than $12,000. The states had scored a partial injunction from a lower court in June that blocked the Education Department from forgiving any loans through Save, and then successfully petitioned the appeals court to stop the plan altogether.

“The Eighth Circuit’s injunction is imposing serious and irreparable harm on the department and the public,” Solicitor General Elizabeth B. Prelogar wrote in a court filing on Aug. 20. “The States cannot deny the harm that the injunction is inflicting on borrowers, including those who have been steadily making payments for years while counting on now-enjoined forgiveness at the end of preexisting repayment periods.”

Older income-driven plans have been swept up in the Save chaos because they were created under the same authority in the Higher Education Act. In 1993, Congress said the education secretary must offer repayment plans tied to a borrower’s income and that capped repayment to no more than 25 years. Lawmakers directed the department to flesh out the details, resulting in the introduction of Income Contingent Repayment (ICR) in 1994, Pay As You Earn (PAYE) in 2012 and REPAYE in 2015 – the predecessor of Save.

All of the plans offered loan forgiveness. Each new one was more generous than the last, with newer plans offering shorter repayment periods and lower payments. Missouri and the other states say the 1993 statute did not authorize loan forgiveness. In its order, the appeals court appeared to agree and enjoined the Education Department from any further forgiveness for any borrower whose loans are governed “in whole or in part” by the statute.

The department said it is working to identify borrowers who are at or near forgiveness on the affected plans and will provide more information once that process is complete.

Without clarification from the appeals court, the Education Department is hitting the brakes on Save and provisions of other income-driven plans. People, like Rodriguez, who want to enroll in Save, can apply by mailing in a paper application. However, the department is directing loan servicers to temporarily pause the processing of applications in the wake of the injunction and has warned that borrowers will be subjected to lengthy delays. During that time, servicers can postpone an applicant’s payments but interest will continue to accrue and the borrower will not get credit toward loan forgiveness.

That last bit is unnerving to Rodriguez, who consolidated her loans with the hope of qualifying for debt cancellation. Since graduating from college 17 years ago, she has struggled to keep up with her student loan payments. At one point, Rodriguez defaulted on her loans and entered the Education Department’s rehabilitation program, which set her payments at $10 a month to help her get current on the debt.

When she learned the Biden administration was letting people with loans from a defunct federal program consolidate to qualify for a one-time forgiveness initiative, Rodriguez jumped at the chance to have her $26,000 balance wiped away. After recently losing her job in marketing, Rodriguez grew eager to have the burden of her debt lifted. Now she’s grown disillusioned with the administration.

“They keep giving us false hope,” she said. “It’s an empty promise at this point.”

To date, the Biden administration has approved $168 billion in loan forgiveness for more than 4.7 million Americans through a mix of existing programs, court orders and the new Save plan. Its most ambitious debt relief proposal in 2023 was thwarted by the Supreme Court, but the administration pressed ahead with alternative plans. Republicans deride the policies, including Save, as fiscally irresponsible and government overreach, and have made every effort to stop them in the courts.

“I don’t know how many times the Biden-Harris administration needs to hear this before the message sinks in its student loan schemes are illegal,” said Rep. Virginia Foxx, R-N.C., chairwoman of the House Education Committee. “Quit trying to force Save through, and instead work with Republicans on real solutions.”

Borrowers like Mary Ann Rockwell, 72, have become collateral damage in the ideological fight over debt relief.

Rockwell, a librarian in Upstate New York, is two months shy of having enough qualifying payments to receive Public Service Loan Forgiveness. The program, created in 2007, cancels the remaining loan balance of borrowers who work in certain nonprofit or government jobs for 10 years and make 120 monthly debt payments. Because of the injunction, the department has postponed Rockwell’s payments. The pause will not count toward loan forgiveness under the program.

“I was sort of in disbelief and kind of numb when I found out,” Rockwell said. “I have to believe this too shall pass, but everything is so up in the air.”

She could switch to a different repayment plan that qualifies for the public service program, but that would send her payments skyrocketing. Rockwell could also take advantage of a new PSLF buyback initiative to retroactively make a lump-sum payment to get credit for the forbearance period, but the terms are complicated. What’s more, if Save is ultimately scrapped by the courts, it is unclear whether the last several months Rockwell has spent in the beleaguered program will count toward PSLF loan forgiveness.

Like many older borrowers with student loans, Rockwell made a career change late in life. After years of working as a licensed practical nurse, she decided to pursue a master’s in library sciences, a field that has allowed her to run literacy programs and help people realize their full potential, she said. But that training came with a hefty price tag, and she amassed over $98,000 in student loans. After postponing her payments multiple times, Rockwell’s balance ballooned to more than $191,000, because the accrued interest was added to the balance each time she exited forbearance. That was enough to keep her in the workforce for longer than she had envisioned.

“I can’t retire until these loans are forgiven because I cannot manage giant payments on the small pension and Social Security that I will get,” Rockwell said. She is considering the other routes the department suggested to gain credit for public service forgiveness but still worries they might not pan out.