Under Secretary of Education Nicholas Kent told an American Enterprise Institute audience on Thursday that federal student loan forgiveness “is not happening,” highlighting the administration’s tone as it moves defaulted accounts to the Treasury Department and winds down the SAVE plan.
This comes from a livestream Q&A session, which marks one of the most public conversations yet around the massive changes to student loans coming this year.
Why It Matters: Kent’s remarks are the clearest signal yet that the Trump administration intends to get the $1.7 trillion federal student loan portfolio back into repayment after nearly six years of pauses and false starts. For roughly 42 million federal student loan borrowers, the near-term question is simple: which repayment plan to choose and how to avoid default.
What Kent Said: Speaking at the American Enterprise Institute on April 23, 2026, Kent opened with an unusual apology: “I’m sorry that you are confused about everything that has happened over the course of the last five or six years with regard to the federal student loan portfolio.” He pointed to the Supreme Court ruling that struck down former President Biden’s broad forgiveness plan as a source of borrower whiplash.
“What we have been trying to do is explain to borrowers that loan forgiveness is not happening,” Kent said.
The Policy Context: Kent’s AEI conversation was framed around the Department of Education’s agreement to shift defaulted student loan collections to Treasury, starting with about 7.7 million borrowers holding roughly $180 billion in defaulted debt. Kent called Treasury “no better partner” for managing the portfolio.
He steered borrowers at risk of default toward the Repayment Assistance Plan (RAP), the new income-driven repayment plan option launching July 1, 2026. After the OBBBA changes, most borrowers must choose between RAP and Income-Based Repayment (IBR).
Kent also addressed efforts to simplify federal student aid and keeping the department’s ombudsman’s office to handle repayment questions.
On default itself, Kent was blunt: “Being in default is not good for a borrower. It’s not good for a taxpayer. It’s affecting their credit score. It’s making it harder for them to buy a house or lease an apartment or to sometimes rent a car.”
The Other Side: Some policy analysts have flagged that RAP can produce higher monthly bills than SAVE for many borrowers, with some payments rising by hundreds of dollars. Senate Democrats have urged Education Secretary Linda McMahon and Treasury Secretary Scott Bessent to rescind the Treasury transfer, and former department officials have warned the hand-off could complicate rehabilitation paths for defaulted borrowers.
How This Connects: The College Investor has been tracking the student loan situation. There are 7.7 million borrowers already in default as collections resumed, the SAVE plan forbearance is ending this summer, the RAP Plan launches on July 1 alongside IBR as the only two income-driven options for new borrowers, and the Senate pushback against moving the portfolio to Treasury.
Kent’s AEI remarks pull those threads together into a single administration message: repayment is the plan, and borrowers need to act on it.
What To Watch: There are a lot of things happening in the next several months:
- July 1, 2026: RAP opens
- September 30: SAVE forbearance ends
- Treasury’s rollout of collections starts this Summer
- Congressional pushback on the inter-agency transfer and any resulting litigation.
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Editor: Colin Graves
Robert Farrington is the founder of The College Investor and is widely recognized as one of the nation’s leading voices on student loan debt and saving for college. He holds an MBA from UC San Diego Rady School of Management and has spent over 15 years researching, writing, and advising on student loans, 529 plans, financial aid programs, and saving and investing for young professionals.
Robert has been featured in the The New York Times, The Wall Street Journal, The Washington Post, NBC News, and Forbes, where he has been a regular personal finance contributor for over a decade. His work combines both professional expertise and personal experience – he successfully navigated his own student loan repayment journey and has helped thousands of readers do the same.
He is committed to making the intersection of personal finance and education transparent and accessible. You can learn more about Robert on the About Page or on his personal site RobertFarrington.com.