DOGE Data Access On Pause, And Other Student Loans News

Since the new administration stepped in, a flurry of executive orders, mass firings and reorganizations have blanketed student loan news sites and raised alarms for borrowers.

Much of the news on federal student loans and the agency that manages them is still evolving as federal judges review new cases and the Trump administration kicks off its four-year tenure. Here’s the latest. As of Wednesday, February 26:

• The Department of Government Efficiency (DOGE) cannot access the student loan database.
• The Consumer Financial Protection Bureau (CFPB) remains without a student loan ombudsperson.
• Linda McMahon awaits confirmation as the Department of Education Secretary.

As student loan borrowers process the ever-changing news, they can balance action with patience to protect their information and manage their loans.

Federal judge blocks DOGE access to student loan data

A federal judge has blocked DOGE’s access to the Department of Education’s student loan data systems, just one week after a different federal judge allowed Elon Musk’s team to continue accessing data.

After learning DOGE had gained access to student loan data, which included borrowers’ names, Social Security numbers, financial information and contact information, student advocacy groups and members of Congress expressed alarm. They claimed such access posed a risk to student loan borrowers.

The University of California Student Association was one of the first to file suit, claiming the access to information violated federal privacy laws and requesting a temporary restraining order. But on February 17, a federal district court judge declined to block DOGE’s access, claiming there wasn’t enough evidence to support the order.

Separately, the American Federation of Teachers filed a similar suit in Maryland. Judge Deborah Boardman ruled Monday that the government failed to argue why DOGE needed to access personal data and blocked DOGE’s access to the student loan data systems. As of right now, Musk and his team cannot review this sensitive information.

What it means for borrowers

Soon after DOGE’s access to data was publicized, TikTok posts claiming borrowers could get their loans dismissed for violation of privacy ran amok on the social media site. Users incorrectly told followers that they didn’t have to pay their student loans anymore because the government violated the Family Educational Rights and Privacy Act (FERPA), which protects a student’s educational records.

This information was quickly debunked. Many media outlets clarified that you cannot file a lawsuit to have your loans canceled by claiming DOGE violated FERPA. In fact, a 2002 Supreme Court ruling found individual borrowers do not have a right to sue due to FERPA violations. However, if you do believe your rights have been violated under FERPA, you can file a complaint with the Student Privacy Policy Office (SPPO).

This social media snafu can be a lesson for all users — one you don’t need student loans to learn. Make sure your financial and legal advice comes from a professional and expert in the field, not a random influencer or viral video. Always check where the information is coming from and verify the facts using other trustworthy sources. Verify student loans-related information with your loan servicers.

Trump administration fires student loan ombudsperson at CFPB

On February 13, acting CFPB Director Russell Vought fired several CFPB employees, including Student Loan Ombudsperson Julia Barnard. The Student Loans Ombudsperson, a position mandated by the 2010 Dodd-Frank Act, handles student loan-related complaints, protects borrowers from scams and holds servicers and lenders accountable.

Barnard posted on her LinkedIn, “I am honored to have served as Student Loan Ombudsman and to have worked with so many dedicated colleagues and the incredible borrowers who reached out for help into what might sometimes feel like a void.”

In the post, Barnard mentioned some of the work accomplished in the past few months as the Ombudsperson, a position she’s held since February 2024. “Over the past few months alone, my team and I manually sifted through over 10,000 complaints, uncovering illegal conduct, identifying the most actionable cases for follow-up, and uncovering systemic and policy failures for Congress,” she wrote.

Shortly after the firings, the National Treasury Employees Union filed a motion to halt the mass firings that could affect up to 95 percent of the agency’s workforce. A federal judge blocked further terminations until March 3, the date of the next hearing on the matter. The firing freeze did not include those who were already terminated. The bureau reportedly responded by placing many employees on administrative leave for the time being instead of firing them.

The firing of the Ombudsperson removes an avenue for student loan borrowers to file complaints and resolve issues. As Barnard wrote, “This work matters. It’s a lifeline for borrowers and a safeguard against a system that too often fails them. Dismantling this function is unconscionable and will cost real people real money.”

What it means for borrowers

While borrowers may have trouble filing a complaint with the CFPB student loan ombudsperson, there are still ways to file complaints and work through issues with their student loan servicers.

Currently, the federal student loan ombudsperson group can help resolve issues related to federal student aid programs. You can submit a federal student loan complaint online or call 1-800-433-3243 for federal loan concerns only.

The Student Borrower Protection Center also provides a list of state-based student loan ombudspersons and student loan advocates to help with student loan-related issues. Keep in mind, not all states have a student loan ombudsperson.

Linda McMahon advances in process to become Secretary of Education

The Senate Committee on Health, Education, Labor and Pensions, voted February 20 to advance Linda McMahon’s nomination to run the Department of Education. This advances her nomination to a full senate vote. If passed, she will become the new Education Secretary.

During her confirmation hearing, McMahon addressed several issues surrounding student loans. Some of her comments included:

• Pledging to uphold the Public Service Loan Forgiveness (PSLF) program.
• Showing a desire to continue and expand the Pell Grant program to short-term workforce programs and apprenticeships.
• Confirming key student aid programs would continue while she “reorients” the Department of Education.
• Acknowledging only Congress can shut down the Department of Education.

In the coming days, the senate floor will vote on whether to confirm Linda McMahon as Education Secretary. While the Senate has yet to confirm her nomination at the time of this writing, Republicans hold a Senate majority and have successfully confirmed other controversial picks, such as Robert F. Kennedy, Jr. for Secretary of Health and Human Services.

What it means for borrowers

Borrowers will need to wait and see what happens after the vote is cast. Major changes to federal programs take time and experts believe federal student aid is likely to continue, especially since Congress must approve any cessation of student loan offerings.

If McMahon holds to her promises, Pell Grants will remain available for students in need and public service workers may still have the opportunity to have their loans forgiven. While the Department of Education’s future is undetermined, student financial aid programs should still be used as the first option for paying for college. Students should fill out their FAFSA and exhaust their federal aid and student loans before applying for private student loans.

Those who qualify for the PSLF program should continue working toward their loan forgiveness by making on-time qualified payments. If you’re currently in a forbearance due to SAVE plan litigation or any other reason, you are not getting credit toward the forgiveness — even if you’re making payments while in forbearance. To get credit toward PSLF, you can buy back months of payments through the PSLF Buyback Program. If you can afford monthly payments, you could also enroll in a different repayment plan.