Trump administration changes course on plan to hire student loan companies

The Trump administration is re-thinking its plan to overhaul the way borrowers repay their student loans, officials announced Tuesday.

The Department cancelled its solicitation for proposals from companies interested in servicing the government’s entire federal student loan portfolio after complaints after criticism from advocates and a bipartisan group of senators, who said awarding the business to just one company could put the government at risk of working with a firm that became too big to fail.

In its place, the Department plans to create a servicing system where the backend and front end of the student loan servicing system will likely be handled by different companies with expertise in each field.

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