Treasury Department begins taking over student loans as the Education Department gets dismantled

Associated Press (AP)CenterEN 4 min read 100% complete by By COLLIN BINKLEYMarch 19, 2026 at 09:53 PM

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long article 4 min

The U.S. Education Department is transferring management of its student loan portfolio to the Treasury Department, beginning with defaulted loans totaling $180 billion (11% of the total). This move is the first step in dismantling the Education Department, as ordered by President Trump a year ago. Eventually, the Treasury Department is expected to assume responsibility for all federal student loans, including non-defaulted ones. The Trump administration claims the Education Department is ill-equipped to manage the large loan portfolio, citing low repayment rates and a focus on loan cancellation under the Biden administration. Borrowers are told they do not need to take any action during the transition and will continue to work with their current loan servicers. The agreement outlines a significant shift in the oversight of federal student aid programs, which have been managed by the Education Department for over 40 years.

Key Entities & Roles

Key Player Opposition Context

Washington 40% Linda McMahon 50% Biden administration 50% United States 60% Donald Trump ×270% Treasury Department ×490% Department of Education ×795%

Keywords

student loans 100% treasury department 90% education department 90% loan portfolio 70% defaulted loans 70% dismantling 60% federal student aid 60% loan servicers 50% linda mcmahon 40%