Education Department Transfers $1.7 Trillion Student Loan Portfolio to Treasury Department

Federal Student Assistance Partnership·March 19 – March 20, 2026

25 days ago

Education Department Transfers $1.7 Trillion Student Loan Portfolio to Treasury Department

The U.S. Department of Education and the Department of the Treasury announced a new partnership to manage the $1.7 trillion federal student loan portfolio announced the Federal Student Assistance Partnership. The Treasury Department will now handle student loan collections and help borrowers return to active repayment assume responsibilities for student loan collections. Officials stated that the Education Department was not intended to act as a large bank and that the Treasury has the expertise to better manage these assets not intended to serve as our nation’s fifth largest bank. This change moves the management of millions of student loans out of the Education Department move student loan debt for millions. The administration aims to bring more financial discipline to the program after years of what they described as poor management bring long overdue financial discipline. This shift is part of a larger effort to reduce the size and scope of the Education Department Education Department is shrinking.

U.S. Treasury Announcement on Student Assistance PartnershipDepartment of Education on Treasury PartnershipTrump to move student loan debt for millions outside Education DepartmentStudent Loan Office to Leave the Education Department

Key Statements

PPOLITICO

“The Department of Education announces a three-phase plan to transfer the federal student loan portfolio to the Department of the Treasury, beginning with loans in default.”

Provides the specific three-phase timeline and starting point for the loan transfer.

TThe Wall Street Journal

“President Trump signs an executive order directing Education Secretary Linda McMahon to dismantle the Department of Education and return authority to the states.”

Identifies the executive order and the broader goal of dissolving the Education Department.

News

What student-loan borrowers need to know about their accounts being moved to Treasury

Business InsiderCenter

Trump administration tasks Treasury Department with student loan collection. What borrowers need to know

CNBCCenter

Trump's push to abolish the Education Department reaches student loan portfolio

The HillCenter

US Treasury to collect student loan debt in Education Department dismantling

Washington ExaminerCenter Right

'Hard reset': Education department shrinks with handoff of student-loan management to Treasury

Washington TimesCenter Right

Treasury Department to take over some federal student loans, as Trump administration works to dismantle Education Department | CNN Politics

CNNCenter Left

Political Response

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