Congresswoman Ayanna Pressley (MA-07), joined by Senators Elizabeth Warren (D-MA) and Bernie Sanders (I-VT), is leading a growing effort in Congress to stop the Trump Administration from advancing any plan to sell or transfer the federal student loan portfolio—currently valued at $1.6 trillion—to private lenders and financial firms. In a letter sent today to Education Secretary Linda McMahon and Treasury Secretary Scott Bessent, the lawmakers, backed by 41 colleagues, urged the administration to immediately halt all privatization proposals.
The letter warns that selling the federal loan portfolio would amount to “a giveaway to wealthy insiders at the expense of working-class borrowers and taxpayers,” severely eroding legal protections that millions of borrowers rely on. Key benefits at risk include income-driven repayment plans, Public Service Loan Forgiveness (PSLF), disability and death discharges, and relief for borrowers defrauded by predatory institutions.
Lawmakers also argue the sale could violate federal law if loans are transferred at a loss. A similar privatization idea was explored in 2019 but abandoned after consultants determined the portfolio was worth far less than previously projected. Despite that history, recent reporting indicates that the Trump Administration is again considering selling federal loans to the private market.
The lawmakers emphasize that turning control over to private lenders—who already hold just 8% of student loans yet account for 40% of complaints to the Consumer Financial Protection Bureau—would exacerbate predatory practices and expose borrowers to greater financial harm. “The Department of Education’s role in providing financial aid to America’s students is clear,” the letter concludes. “The Department should not take any action that would enrich the wealthy and well-connected at the expense of working-class borrowers and taxpayers.”
The coalition has requested detailed information on any privatization plans by December 1, 2025.
Rep. Pressley has emerged as one of Congress’s most vocal champions for student debt relief and cancellation. She successfully urged President Biden to implement a historic forgiveness initiative benefitting more than 40 million Americans and has continued fighting to safeguard PSLF and other borrower protections. Pressley’s recent initiatives include legislation to halt wage garnishment for student borrowers, advocacy to prevent a looming “student loan default cliff,” and repeated efforts to terminate federal servicing contracts with companies accused of harming borrowers, including MOHELA and Navient.
