Treasury Department Takes Over Student Loan Collections From Dept Of Education

Treasury Department Takes Over Student Loan Collections From Dept Of Education

Author: The College Investor March 23, 2026 Duration: 9:31
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The Department of Education and the U.S. Treasury Department announced a new interagency agreement on March 19, 2026, that will shift operational control of defaulted federal student loan collections from Education to Treasury. This comes as nearly 7.7 million student loan borrowers holding $180 billion in student loans are in default.

The move, which the administration has branded the “Federal Student Assistance Partnership,” marks a big step forward in dismantling the Education Department in what officials described as the equivalent of the “fifth-largest commercial bank in the United States.”

Under the agreement, Treasury will immediately take over collecting on defaulted student loan debt, using private collection agencies to help borrowers in default enroll in rehabilitation programs or return to good standing.

Treasury will also absorb the operations of FSA’s Default Resolution Group, which manages the Default Management and Collections System (DMCS). In future phases, Treasury would expand to managing non-defaulted loans and potentially other FSA functions, including FAFSA administration.

It's important to realize that Treasury already played a large role in collections, but this is now administrative control of the bigger program.


Hosted by Robert Farrington, founder of The College Investor and a recognized Millennial Money Expert, The College Investor Audio Show transforms the website's most valuable insights into a daily, conversational format. This podcast directly tackles the financial hurdles unique to a generation, moving beyond theory into practical, actionable strategies. Each episode focuses on the core pillars of modern financial health: systematically eliminating student loan debt, demystifying the fundamentals of investing, and creating actionable paths to increase your income. The goal is clear: to guide you from a place of debt management to one of confident wealth building. You'll hear straightforward advice on navigating repayment plans, understanding where and how to start investing even with limited capital, and exploring side hustles or career moves that make a real difference. It’s a resource for anyone feeling stalled by their loans and eager to lay a solid foundation for their future. Tune in for a no-nonsense take on millennial money, where complex topics are broken down into manageable steps you can apply immediately.
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