The Department of Education announced a plan to shift responsibility for the roughly $1.7 trillion federal student loan portfolio to the Treasury Department, starting with defaulted loans. Education Secretary Linda McMahon framed the move as a step to improve collections and compel repayment by leveraging Treasury tools, including the IRS’s garnishment power. Treasury Secretary Scott Bessent will now oversee debt collection functions previously managed by Education. Officials say the transfer aims to reduce defaults and recover federal dollars more efficiently, but legal and political questions followed immediately. Critics argued the move could be unlawful, and consumer advocates warned of harsher collection tactics for distressed borrowers. University financial-aid offices and student-affairs teams will need to prepare for changes in borrower outreach and default prevention programs if Treasury’s approach alters relief or rehabilitation options.