DeVos undoes Obama’s student-loan protections

Education Secretary Betsy DeVos on Tuesday rolled back an Obama administration attempt to reform how student loan servicers collect debt. The former president’s administration issued a pair of memorandums last year requiring that the government’s Federal Student Aid office, which services $1.1 trillion in governmentowned student loans, do more to help borrowers manage their debt.

But in a memorandum to the department’s student aid office, DeVos formally withdrew the two Obama memos. The Obama administration’s approach, DeVos said, was inconsistent and full of shortcomings. She didn’t detail how the moves fell short, and her spokesmen, Jim Bradshaw and Matthew Frendewey, didn’t immediately respond to a request for comment.

A recent epidemic of student loan defaults and what authorities describe as systematic mistreatment of borrowers prompted the Obama administration, in its waning days, to force the FSA office to emphasize how debtors are treated rather than maximize the amount of cash they can stump up to meet their obligations.

DeVos’ move “will certainly increase the likelihood of default,” said David Bergeron, a senior fellow at the Center for American Progress, a Washington think tank with close ties to Democrats, who previously worked under Democratic and Republican administrations.