Mike Moen, producer/reporter, United States News Service, Public News Service.
Student loans are among the areas overseen by the U.S. Department of Education. Since President Donald Trump has followed through on his threat to gut the agency, questions are mounting about the fate of loan services.
The president signed an order Thursday he said begins the process of dismantling the department, even as questions mount about the limitations of executive power for this move.
A White House official said the skeleton agency will continue to run student loan programs and Pell grants, but higher education advocates worry about borrowers facing issues.
Problems for borrowers
Mike Pierce, cofounder and executive director of the Student Borrower Protection Center, feels the system was already broken.
“We expect that things will only get harder for working people with student debt and for families that are trying to pay for college,” Pierce projected.
Pierce explained he hears from borrowers who have waited on the phone for several hours to talk with private companies with which the government contracts. He predicted longer delays. There is also concern about updating eligibility for income-driven repayment plans. The Center said if you have service issues, contact your local member of Congress and submit what is called “casework” so a staffer can help. The White House said its actions can drastically improve program implementation in higher education.
Consumer advocates encouraged families to see if their state has a Student Loan Ombudsman who could provide critical information. The executive order comes after the administration recently cut 50% of the Education Department’s staff.
Pierce argued creating even more chaos and confusion could undercut the higher-education path for students coming from disadvantaged households.
“When these programs are run poorly, families that wouldn’t otherwise be able to go to college, they’re the first to miss out,” Pierce contended.
The department is tasked with keeping for-profit colleges in check. Pierce noted there has been a lot of progress in weeding out problematic schools but he worries Trump’s actions will lead to a resurgence of institutions engaging in predatory tactics.
Groups like the Lumina Foundation have echoed similar concerns about the agency’s fate and the effects on student loans and financial aid.
Support for this reporting was provided by the Lumina Foundation.
