ED shifting federal student loans to Treasury amid dismantle
Key Questions
What is the planned shift of federal student loans to the Treasury?
The Department of Education is phasing a handover of $1.7 trillion in loans to Treasury, which could disrupt PSLF and IDR programs during the transition.
What changes does OBBBA introduce for graduate and Parent PLUS loans?
OBBBA eliminates Grad PLUS loans and imposes caps on Parent PLUS loans, with new rates starting July 1 at 8.07% for graduate loans and 9.07% for Parent PLUS, the highest since 2007.
Is there still time to consolidate loans before the changes take effect?
Borrowers have until June 30 to consolidate, and the double-consolidation loophole for Parent PLUS loans under SAVE remains active despite the broader shifts.
Phased $1.7T handover threatens PSLF/IDR; OBBBA Grad PLUS elim/Parent PLUS caps; June 30 consol rush. Double-consolidation SAVE loophole for PLUS loans remains active.
Sources (2)
Updated May 24, 2026