"The Education Department has effectively ended its oversight of whether student loan servicers maintain accurate records and provide quality customer service, the Government Accountability Office says in a new report. But the Trump administration and loan servicer associations counter that, contending that while two ways to gauge the quality of customer service calls and accuracy of data have been discontinued, plenty of other accountability measures still remain in place."
"Historically, under a system put place by the Biden administration in 2024, the department's evaluation process focused on six standards: data accuracy, customer service call quality, call abandonment rate, customer satisfaction, timeliness of completion of certain tasks and financial monitoring. Any servicer that failed to meet one or more of these standards could face a deduction of up to 5 percent of their contractual pay rate per failed category, or 20 percent total."
"At FSA, the number of staff plummeted from 1,433 to 777, or by 45.8 percent, between January and December 2025, according to the GAO. The report, released Wednesday, suggests that the decline in quality assurance is tied to a dramatic downsizing in staff at FSA and throughout the Department of Education."
The Government Accountability Office reports that the Education Department has effectively ended its oversight of student loan servicers' record accuracy and customer service quality. This decline coincides with a dramatic staffing reduction at the Federal Student Aid office and throughout the Department of Education. Education Secretary Linda McMahon cut the department's workforce in half, reducing employees from over 4,100 to approximately 2,000. At FSA specifically, staff decreased by 45.8 percent from 1,433 to 777 between January and December 2025. Previously, the department evaluated servicers on six standards including data accuracy and call quality, with potential penalties up to 20 percent of contractual pay. Starting February 2025, FSA discontinued database audits and customer service call monitoring, despite servicers failing accuracy standards and facing $850,000 in assessed fines.
#student-loan-servicer-oversight #government-accountability #department-of-education-staffing #customer-service-quality #regulatory-enforcement
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