The Ministry of Education was halved. What does this mean to student loans?

The Ministry of Education still exists, but it is about half of the size it was yesterday.

Against the background of President Donald Trump’s calls to close the agencyThe Education Department announced in a statement Tuesday that he will release almost half of his 4133 workers, including 600 employees who had already accepted voluntary resignations or retirement.

For the borrowers of the student loan, the department will continue to provide student loans and grants to Pell. However, there will also be abbreviations of staff in each division within the department.

“We still arrange what areas have been affected, but from what I know so far, it will affect the most Student Loan Institutesaid in response by email.

The Ministry of Education Linda McMahon has previously stated that the closure of the department will require an act of Congress, but it issued a statement Last week, describing the upcoming tasks as the “last mission” of the department.

“The Trump Directive) to me, obviously, is to find the Ministry of Education, which we know we will have to work with Congress, you know to achieve this,”. McMahon said Fox News on Tuesday. She said that the management of federal student loans and Pell grant can be reassigned if the department is eliminated.

The Ministry of Education plays a major role in the education system in the United States, but may be most famous for the management of federal financial aid for millions Student loan borrowersS If you have federal student loans, here’s what experts can be on the horizon if the Ministry of Education is closed.

Read more: What happens if the Ministry of Education is abolished? What we know

Why does Trump administration want to remove the Ministry of Education?

The Ministry of Education was established by Congress in 1979 to trace, manage and coordinate the educational programs and procedures at the federal level. Trump’s advisers said they wanted to call on the congress to remove the department, a move that has been floating over the years by Republicans, but has always failed to receive wide support.

“It is not quite clear why Republicans want to get rid of the US Department of Education,” a student loan expert Mark Kantovitz said in an email. “Why would you get rid of a powerful tool for implementing your education program?”

The Trump Administration campaign to reduce the size of the federal workforce, so that the exclusion of the Ministry of Education can be considered as part of this program. The department also manages the federal student loans that Republicans have headed As former President Joe Biden strongly supported the relief of student debt.

There may also be confusion about the role of the department in public education, including the wrong conviction that he controls the C-12 curriculum. The Ministry of Education does not develop a curriculum for any schools. The requirements are set at the state level, and local school councils create curricula for fulfilling these requirements.

For example, Nucleuswhich many consider to be “national standards” for education, was created as a multistrial effort by the National Association of Governors and the Council of General State School Employees to Standardize Education Requirements across the country. However, the Ministry of Education did not participate in the development of these standards.

Can the President close the Ministry of Education?

The president cannot unilaterally remove the Ministry of Education, as it is created by an act of Congress that has the power to remove it. Congress is unlikely to remove the department, as Republicans control only 53 votes in the Senate, and requires 60-mastery of ultimate.

However, although the closure of the Ministry of Education may be entirely beyond the competence of the President, the Trump administration has begun to take action to terminate specific functions and programs. The billionaire Doge team Elon Musk has already begun to pull out the department by terminating contracts and fired staff.

Congress can also reduce the budget of the department by reconciling the budget, which requires only a simple majority. “Suggestions for getting rid of plus loans, Interest deduction for a student loan., (US tax credit), (lifelong training loan)The protection of the borrower for repayment, closed release from the schools and aspects of the PSLF can be carried out through reconciliation of the budget, “Kantovitz said.

Read more: My monthly student loan payment can jump from $ 0 to $ 488. Here’s how I prepare

What happens to student loans if the Ministry of Education is eliminated?

If the Ministry of Education is completely eliminated, many of its programs, including federal student loans, will probably remain in some form and move to different departments.

“Some claim that this responsibility should fall under the Treasury, given that federal student loans are funded by the Ministry of Finance,” ” Elaine RubinStudent loan policy expert and director of communications for brigaries, an email said. She added that if the same management system is used to administer the program, “the transition, although taking time, can be managed.”

But any shift would take time and could violate millions of borrowers trying to apply or pay off student loans. “The Ministry of Finance has no experience with higher education rules, so there may be some chaos,” Kantovitz said.

Wherever the student loans are completed, the current borrowers must expect the same terms that they have agreed when they accept the loan.

“If the student loans are transferred to another federal agency, the interest rates and the terms of the loans will not change. These conditions are stated in the note of the main order and in the law,” Kantovitz said.

How about the student loan forgiveness?

President Trump has made it clear that it is not in favor of broad programs to forgive a student loan loan, calling efforts to alleviate Biden’s student loan “complete disaster” during a presidential debate last year.

During his hearing for confirmation of Education Secretary, McMahon told the Senators that the Ministry of Education would honor Public Student Loan Program And other student loan forgiveness programs that Congress has created.

According to Kantrowitz, the removal of the department will also not affect the borrowers whose loans have already been forgiven. “The President cannot forgive forgiveness that is already insured. This is legally binding,” he said. The courts also say that forgiveness has “irreversible” impact. “

Bayden’s administration Save a valuable education planAnyone who had lowered the monthly payments and offered additional opportunities for forgiveness was removed from the decision of the US Court of Justice last month. Save was already in the cutting block and the Trump administration is not expected to defend the plan.

The Ministry of Education recently Closed applications for all income payment plans Temporarily, leaving the borrowers of a student loan at Limbo and with limited options for larger payment plans.

Read more: You cannot be forced to pay forgive student loans – unless that happens

What to do if you have student loans

For most current borrowers, the impact of the department removal may not be obvious immediately. “Most functions are realized through performers, so it is unlikely that the borrowers of a student loan will notice something different,” Kantovitz said.

Mayor agreed that most borrowers would not see much impact on the total day a day, so far.

“Receiving new loans or receiving benefits for existing loans, including PSLF, should not be influenced,” she said. “But they are still early days.”

So far, borrowers who have student loans must be set up for updates and prepare for Restart payments if they were on a pauseS Make sure you know who your service loan is and that they have your current contact information. If you are enrolled in the repayment plan, Expect to pay more this yearS You can use The Ministry of Education’s loan simulator To calculate your new payment and think Other options and saving strategiesS

If you are enrolled in PSLF and are close to the 120 payments mark, you may want to consider applying for PSLF Redemption ProgramS It allows you to “buy” months without pay that are not reported for forgiveness while your loans were patience or delay. Although the PSLF program can still be safe for many participants, the redemption program can disappear, so now is the time to take advantage.