Education Dept. Shifts Control of Student Loans to Treasury in Move to Dismantle Department
“We are undertaking the first serious effort to clean up a $1.7 trillion portfolio that has been badly mismanaged for years”
Linda McMahon has been an awesome Education Secretary. It’s somehow fitting that she could be the last one.
Campus Reform reports:
Dept. of Ed shifts student loan control to Treasury Dept. in move to dismantle department
The U.S. Department of Education (ED) announced Thursday that control of federal student loan operations will shift to the U.S. Department of the Treasury, marking a significant step toward dismantling the ED’s control over the federal student loan system.
The initiative, called the Federal Student Assistance Partnership, will transfer key responsibilities, particularly the collection of defaulted loans, to the Treasury Department, as the Trump administration attempts to stabilize a student loan portfolio that now totals approximately $1.7 trillion.
Fewer than 40 percent of borrowers are currently in repayment, while nearly one-quarter are in default, according to federal data released alongside the announcement. The size of the loan portfolio now exceeds total U.S. credit card and auto loan debt, the department stated.
Education Secretary Linda McMahon said the agreement represents a structural shift in how federal student aid is administered.
“The Federal Student Assistance Partnership marks an intentional and historic step toward breaking up the Federal education bureaucracy and dramatically improving the administration of Federal student aid programs,” McMahon said.
Under the agreement, the Treasury will initially focus on collecting defaulted student loan debt and assisting borrowers in returning to repayment.
Future phases may expand the Treasury’s role to include oversight of non-defaulted loans and other operational aspects of federal student aid programs, where permitted by law.
Treasury Secretary Scott Bessent said the department’s financial expertise positions it to bring greater accountability to the program.
“We are undertaking the first serious effort to clean up a $1.7 trillion portfolio that has been badly mismanaged for years,” Bessent said. “Treasury has the unique experience, the operational capability, and the financial expertise to bring long overdue financial discipline to the program and be better stewards of taxpayer dollars.”
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Comments
blmplo: why should I have to pay back these loans? when I can just wait it out for the next admin to come in
Suing indebted students is a great way to make sure whom is the next admin.
Federal student loans are forgiven in full upon death.
I know of person receiving a six-figure pension who has federal student loans for their children.
His repayment plan: Pay the minimum. Stiff uncle upon death.
Excellent. Killing another crap program from Jimmy Carter. Education has steadily gotten worse every sod-bollocking year it has existed. Stop the corruption and failure!
I voted for this.