Story perspectives

Trump Shifts Student Loan Management to Treasury Department

3/21/2026

Summary

Story summary

U.S. President Donald Trump is transferring federal student loan management from the Education Department to the Treasury Department, the tenth interagency agreement to shift Education Department responsibilities.
The transition unfolds in three phases, beginning with Treasury handling defaulted loans affecting more than 9 million borrowers.
Education Secretary Linda McMahon says the change will improve loan management, while critics warn it could create confusion and hinder borrower rights.

History

Historical Context

The Higher Education Act of 1993, signed by President Bill Clinton, restructured federal student loans by introducing the Direct Loan Program, allowing the government to lend directly to students. This shift aimed to improve access to education, but concerns persist about borrower protections as management transitions to the Treasury, potentially impacting over 9 million borrowers currently in default.

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Story summary

U.S. President Donald Trump is transferring federal student loan management from the Education Department to the Treasury Department, the tenth interagency agreement to shift Education Department responsibilities.
The transition unfolds in three phases, beginning with Treasury handling defaulted loans affecting more than 9 million borrowers.
Education Secretary Linda McMahon says the change will improve loan management, while critics warn it could create confusion and hinder borrower rights.

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