“Direct Loans are made by the U.S. Department of Education.” — Congress (and my loan contract)
Student loan master promissory notes for the federal direct student loan program state that those loans are owned by DOE and governed by the Higher Education Act of 1965, 20 U.S.C. § 1001, et seq. That law, as amended in 1998, allows DOE to "sell" student loans except that “any such sale shall not result in any cost to the Federal Government.” 20 U.S.C.A. § 1087i. Other federal statutes reference transfers of debts, and permissible sales where there are no “net” costs. This law does not. And not only did Trump not announce a “sale” but any such sale to another federal agency would absolutely involve costs (transactional, purchase price, etc.). Nor have I found any other law authorizing an immediate transfer like the one Trump announced.
I don’t even see how federal law would allow student loan debt in good standing to be immediately transferred to the Treasury Department, which is perhaps why he didn’t take that much more obvious route.
What am I missing? (Aside from general lawlessness, I’m not missing that I promise.)