Overview

• Senior Education and Treasury officials have discussed selling portions of the $1.6–$1.67 trillion federal student loan portfolio and have talked with finance executives, with the option of hiring an outside firm to assess valuations, according to multiple reports.
• An unnamed source confirmed to USA TODAY that the idea is under consideration and said no decisions are imminent, while the administration has not officially announced a sale.
• Federal law permits sales only after Treasury consultation and only if taxpayers would not incur a loss, a constraint analysts say is difficult given private buyers lack the government’s collection powers and legal protections.
• The portfolio covers roughly 42–45 million borrowers, and experts and advocates warn a transfer could complicate or alter access to certain federal safeguards and introduce uncertainty about repayment options.
• The exploration revives a 2019 effort that stalled after analyses found many loans were worth less than expected, and it aligns with President Trump’s push to shrink the Education Department, including an executive order proposing to shift loan functions to the Small Business Administration subject to congressional approval.