President Donald Trump has expressed a desire to close the Department of Education, but he does not have the power to do so through an executive order. While the president cannot eliminate the department, he can significantly reduce its impact by cutting its functions and programs. The Department of Education plays a crucial role in managing federal financial aid for student loan borrowers, and experts predict potential changes if the department were to be shuttered.
The Trump administration’s push to eliminate the Department of Education stems from a desire to reduce the size of the federal workforce and target federal student loans, which have been a focus of Democratic policies in the past. There is also some confusion about the department’s role, as it does not control K-12 curriculum but rather sets guidelines at the state level. Despite these motivations, the ability to shut down the department entirely would require an act of Congress, making it unlikely given the current political landscape.
If the Department of Education were to be eliminated, federal student loans would likely be transferred to another government agency, such as the Treasury. However, this transition would take time and could potentially disrupt the loan application and repayment processes for millions of borrowers. Current borrowers can expect the terms of their loans to remain the same, as those terms are specified in their agreements and in federal laws governing student loans.
President Trump has expressed opposition to broad student loan forgiveness programs, but his administration has indicated that existing forgiveness programs, such as the Public Student Loan Forgiveness Program, would be honored. Eliminating the Department of Education would not affect borrowers who have already received loan forgiveness, as these decisions are legally binding and irreversible. The recent court ruling against the Biden administration’s SAVE plan has further complicated the landscape of student loan forgiveness.
For current student loan borrowers, the potential elimination or restructuring of the Department of Education may not have an immediate impact. Most functions are carried out by contractors, meaning borrowers are unlikely to notice any immediate changes. However, borrowers should stay informed about any updates and be prepared to resume loan payments if they have been on pause. Those enrolled in income-driven repayment plans or forgiveness programs should also consider alternative options and strategies to manage their loans in the event of changes.
Overall, while the prospect of eliminating the Department of Education may be concerning for student loan borrowers, the likelihood of this happening remains unclear. Borrowers should stay informed about any changes that may impact their loans and be proactive in managing their student loan payments and forgiveness options. Despite potential disruptions, it is essential for borrowers to stay informed and prepared for any changes that may arise in the future.
