Jake JonesEducation Secretary Betsy DeVos told states they shouldn't try to regulate student loan servicing companies because it "impedes uniquely federal interests" and "undermines uniform administration of the program."
Her memo is an "interpretation," not a mandate or order, so it may not hold weight if it's challenged in courts. It's a response to some laws aimed to limit student loan providers in how they operate within state borders.
DeVos argues her department has enough protections in place to shield students from shoddy loan collecting practices or mismanaged debt. But the Consumer Financial Protection Bureau has received tens of thousands of complaints about these services, which collectively own more than $1.4 trillion in student debt.
