“Instead of providing relief to 43 million Americans who are drowning in student debt,” Sanders said in a statement to NPR, “the Trump administration has made it harder for them to understand how much they owe and how long it will take to pay it off.”
What the administration has to say about the GAO findings
The Office of Federal Student Aid is supposed to conduct quarterly reviews, according to its contracts with loan servicers.
These reviews include comparing loan servicers’ borrower records with the FSA’s own records, to look for gaps or discrepancies, as well as “targeted reviews” of borrowers in specific situations, including those requesting temporary relief from their payments.
Assessments that have been paused are more labor-intensive than other types of oversight that have been automated, the GAO says. According to the report, agency officials told the government watchdog that they stopped these reviews in early 2025 “due to a lack of FSA staff capacity.” That’s around the same time the Trump administration began slashing staffing levels at the Department of Education.
According to the report, the FSA began 2025 with 1,433 employees; in December, it had 777, a reduction of 46%.
In a written response accompanying the report, Richard Lucas, FSA’s acting chief operating officer, disagreed with the GAO’s recommendation that FSA resume reviews. While confirming that the FSA had indeed stopped the oversight in question, Lucas wrote: “The FSA determined that a better approach is to provide substantial oversight through additional activities that measure the accuracy of administrators’ data and the quality of their performance.” Those activities include periodic reviews of borrower satisfaction surveys.
Melissa Emrey-Arras, who led the GAO study, says the FSA’s “best approach” is not better.
“While reviewing those satisfaction surveys can be helpful, they do not directly evaluate the quality of information provided to borrowers. A borrower may indicate that they were satisfied with a call, without realizing that their servicer gave them completely incorrect information,” he says.
Latest FSA review found issues with loan servicer accuracy
Scott Buchanan, executive director of the Student Loan Servicing Alliance, which represents servicers working in the federal student loan program, says servicers also police themselves.
“[Servicers] Internally we are monitoring far more than any of our regulators could or ever would. Because it’s in our best interest to make sure those bugs are fixed. And because we have contracts, and if we have major problems that have become clearly evident, then people will say, ‘We’ll find someone else to do it.'”
In late 2024, before the Trump administration eliminated oversight, the GAO’s review of administrators’ record-keeping found that “four of the five administrators did not meet the accuracy performance standard and faced associated financial penalties.”
In fact, record-keeping at two administrators was problematic enough to merit the maximum financial penalty allowed.
And the GAO notes that the Department of Education’s independent financial auditor reported in January 2026 that the department “continued to have a material weakness related to the reliability of its student loan data.”
What’s more, says Emrey-Arras, reducing oversight at the FSA has also meant reducing efforts to hold directors financially accountable for their performance. This accountability, he says, “is critical. Without it, the government risks overpaying for poor performance.”
For borrowers, servicer errors can lead to very real problems, Rep. Scott said in a statement to NPR. “Borrowers may overpay or be placed in the wrong student loan repayment program. [The Education Department’s] “Refusing to supervise student loan servicers is a dereliction of duty.”
Reduced Oversight of Big Student Loan Changes
These staffing and oversight cuts come as millions of federal student loan borrowers will need help transitioning to new repayment plans. The Biden-era SAVE plan is in crisis: Borrowers are now being charged interest and the plan must close by 2028. Another 12 million borrowers are either by default on your loans or on your way there.
What’s more, a series of new and potentially challenging changes to the student loan program will begin in July: Courtesy of Republicans’ One Big Beautiful Bill – including the introduction of two new payment plans and the phasing out of others.
