Treasury to Oversee Federal Student Loans in Phased Takeover

Education Department will transfer the $1.7 trillion federal student-loan portfolio to the Treasury in phases, starting with about 9 million defaulted accounts; Treasury will handle default-collections and advise borrowers on returning to repayment, while borrowers should keep paying through their current servicer and watch for new repayment options. Advocates warn the move could worsen hardship and that Treasury lacks borrower-rights expertise; the shift follows a January pause on collections and comes as Biden’s SAVE plan is eliminated and Trump’s repayment overhaul pushes millions into new plans. The exact timeline for the pause and full rollout remains unclear.