As Trump Goes After Education Department, Staff Cuts Leave Student Loan Borrowers in the Dark – Money Heist

As Trump Goes After Education Department, Staff Cuts Leave Student Loan Borrowers in the Dark

An American Flag and a Us Department of Education Flag Fly Outside the Us Department of Education Building in Washington, DC, Us, FEB. 1, 2025.

Annabelle Gordon | Reuters

Federal Student Loan Borrowers Experiencing Dificulties with Their Loans Cold Find they have no recourse as President Donald Trump‘S Cuts to Staff at the Department of Education are carried out, Employees at the agency said.

Staffers at the education department tasked with Fielding Complaints From Federal Student Loan Holders and Resolving their issues were let go in the Recent job cutsOne Employee Told CNBC. At Least Eight of the Fired Staffers Working on a Total of Nearly 800 Student Loan Borrower Complaint Cases, An Employee Said.

The Remining Staff will likely have to take over these accounts. But, the employee said, “I have no idea when they’ll get ressigned.”

As a result, those borrowers “just have to continue to wait, and maybe they go into delyinquency,” The staffer said.

Hundreds of Thousands of People Submit Complaints to the Office of the ombudsman at federal student aid Each year, according to a rough calculation by Higher Education Expert Mark Kantrowitz.

Trump is expected to sign an executive order calling on education secretary linda mcmahon to abolish the agency, a move that experts say would Worsen the Situation for BorrowersThe Wall Street Journal First Reported on that expected order.

As a department authorized by Congress, the department cannot be eliminated without Congress. But in the meantime, the trump administration can slowly star it by cutting resources.

There are roughly 42 million Americans Who Ove Federal Student Loans, and the Outstanding Debt Exceds $ 1.6 Trillion. Currently, Around 9.2 Million People – 43% of the Roughly 22 Million Borrows with Payments due – Are behind on their paymentsAccording to a Recent VantagesCore Report.

Federal Student Loan Borrowers Need Assistance Now More Than Ever, The Education Department Staffers Said. Collection Activity is resuming for the first time in roughly five years after the expiration of pandemic-ralief, and a new repayment plan, called save, that millions haad enrolled in is nowed in the coupled.

“People will start having their wages or benefits garnished,” The staffer said. “If this happy, it would be extramely different to resolve that on your own.”

“Borrowers would be stuck having their money seized without a way to stop it,” they said.

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Borrowers who reach out the education department with questions or complaints

Sources for this story requested anonymity because they feared retribution if they were named ..

A White House Spokesperson Did Not Respond to Questions from CNBC about the Slowdown in Student Loan Borrower Assistant at the Education Department.

The in-House team dedicated to helping borrowers with Public service loan forgiveness Program no longer exists, a staffer said. As a result, reminding Employees are unsure of where to direct borrowers who have issues with this program, the employee said. (PSLF is a popular way for public servants and those who work at nonprofits to get their debt canceled after 10 years of payments.)

“We lost that experience and the ability to answer complaints in a timely manner,” The Employee said.

Staffers say borrowers are alredy feeling the effect.

One Employee Told CNBC Hey Currently Helping A Woman Get Her Student Debt Discharged BeCause of Her Disability, and that “Every time we talk She’s terrified I won’s terrified I won’s terri

The Employees said their work in Complaint Resolution Has Huge impacts on People’s Financial Lives, and those efforts are now at risk.

They said they were able to get loans discharged for Victims of Identity Theft, Teachers and Countless Disabled Borrows.

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