US EditionTreasury Department begins taking over student loans as the Education Department gets dismantled
The Treasury will manage about $180 billion in defaulted federal student loans, representing 11% of the $1.7 trillion portfolio, under a phased transfer from the Education Department.
- Under a Thursday interagency agreement, the U.S. Treasury Department will take over collecting on defaulted federal student loan debt in the first phase of a three-phase plan.
- Last year, President Donald Trump signed an executive order to begin dismantling the U.S. Department of Education, and administration officials are relocating its operations via interagency agreements.
- About 9.2 million Americans are in default on student loans, with defaulted loans totaling about $180 billion of the nearly $1.7 trillion federal student loan portfolio.
- As collections resume, officials note that federal student loan borrowers do not need to do anything and will keep the same loan servicer, though collections paused since January raise near-term stakes.
- Critics warned that later phases could see Treasury assume responsibility over non-defaulted loans and FAFSA, as Rachel Gittleman said, 'The Trump Administration continues to unlawfully dismantle the Education Department by moving programs and offices to other federal agencies despite clear warning from Congress that Education Secretary Linda McMahon lacks the authority to do so.
106 Articles
106 Articles
Treasury Department to take over some federal student loans, as Trump administration works to dismantle Education Department
The Treasury Department will begin to manage federal student loans in default, taking on a key function of the Education Department as the Trump administration further pushes to dismantle it.
The Department of Education announced the start of transfers of federal student loans to the Treasury Department. Under the Trump administration’s plan to shrink the size and scope of the DOE, the bill is the latest change to continue restructuring the functions of the agency led by Linda McMahon. Read more
Daily Montanan
Education Department to transfer management of defaulted student loans to Treasury
The U.S. Department of Education on Feb. 20, 2026. (Photo by Shauneen Miranda/States Newsroom)WASHINGTON — The U.S. Treasury Department will take over the Department of Education’s responsibility for collecting on defaulted federal student loan debt, President Donald Trump’s administration announced Thursday. It’s the first step in a multi-phase process that will end with Treasury taking on the entire federal student loan portfolio. It’s also th…
Education Department to transfer management of defaulted student loans to Treasury • Washington State Standard
The U.S. Department of Education on Feb. 20, 2026. (Photo by Shauneen Miranda/States Newsroom)WASHINGTON — The U.S. Treasury Department will take over the Department of Education’s responsibility for collecting on defaulted federal student loan debt, President Donald Trump’s administration announced Thursday. It’s the first step in a multi-phase process that will end with Treasury taking on the entire federal student loan portfolio. It’s also th…
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