May 6, 2025

Trump Education Dept Says It Will Name Colleges Whose Grads Aren’t Repaying Loans

The Trump Department of Education announced two weeks ago that it planned to go hard at student loan borrowers who have not been repaying, declaring that on May 5 it would resume collections of defaulted loans. It was the previous Trump administration that halted collections, in March 2020 at the start of the pandemic. But the Department now says it will track down borrowers in default and “urge” them to start repaying, and this summer will move toward wage garnishment and authorize private loan guaranty agencies that hold older student loans to do the same.

The Trump administration, as it does on most issues, blamed the Biden administration, saying it was irresponsible for the Department of Education under Biden to try to cancel debt for many struggling students — even though easing past debt would right wrongs for millions of students deceived by predatory colleges, and help an even larger group of students escape paralyzing loans and get a new economic start.

On Monday, the Department took one potentially constructive step — it stressed directly to colleges and universities that they have a responsibility to constrain student debt, and it announced it would begin calculating and publishing online rates of loan nonpayment by school. Federal law already requires the Department to publish loan default rates by schools, and punish repeat offender schools with high rates, but for-profit schools, among the worst offenders by this measure, have for years manipulated these statistics and avoided consequences by pushing students into loan “forbearance” status. Department of Education publication of “nonpayment” rates — broader than formal loan defaults — might help expose school failings and steer prospective students to better school options.

And the fact that the Department under Trump is suggesting that schools bear some responsibility for their students’ growing  loan debt is useful. It could be just another effort by the Trump team to blame Harvard and UC-Berkeley for all of America’s problems.  But the data, if produced honestly, would show where much of the real problem lies in terms of burying students in insurmountable debt — high-priced, low quality career colleges that use deceptive practices to sign up students.

Unfortunately, actions that the Trump administration already has taken may undermine any effort to restrain the worst drivers of student debt, even if they are called out.  The administration, repeatedly violating the law, has undermined the key enforcement agencies that have worked to hold predatory colleges accountable — gutting the Department of Education, including the investigations and enforcement teams there; destroying the Consumer Financial Protection Bureau; firing the Democratic members of the Federal Trade Commission; and more.

It will require the vigilance and determination of state attorneys general and state education oversight agencies to provide students with meaningful protection from predatory schools.