Trump Officials Reportedly Discussing Selling Student Loans

The Trump administration is weighing whether to sell off parts of the federal student loan portfolio, Politico reported, reviving an idea from the first time Trump was in office.

Selling the loans to a private company would allow the administration to shrink the $1.6 trillion portfolio and scale back the federal government’s role in student lending. The discussions, according to Politico, have included senior officials from the Education and Treasury Departments and could include an outside firm that would essentially appraise the student loan programs.

Politico noted that the law does allow the Education Department to sell the loans, “but only if the transaction would not cost taxpayers money.” Selling off the loans raises a number of questions and issues for borrowers, in part because private loans don’t have the same protections or benefits as federal loans. More than 45 million Americans have federal student loans.

News of the discussions come as the administration is exploring ways to shut down the Education Department—an effort that would likely involve moving the portfolio to a different agency—and overhauling the student loan program itself in response to Congress’s One Big Beautiful Bill Act, which passed over the summer. 

Advocates for borrowers criticized the reported discussions.

“Now we know why President Trump and Secretary McMahon are hell-bent on squeezing every last dollar out of families with student debt,” Protect Borrowers executive director Mike Pierce said in a statement. “Once again, we see that across the Trump administration, when Wall Street’s demands run against the financial needs of working people, the banks get what they want.”