US Treasury, Education Dept Launch Online Portal for 9.3 Million Defaulted Student Loan Borrowers

The US Treasury and Education departments on September 30, 2026, launched the Defaulted Loans Support Center, an online portal at StudentAid.gov allowing federal student loan borrowers in default to compare exit options, apply for rehabilitation or consolidation, make payments and review discharge options. Education Department data show about 9.3 million borrowers were in default as of June 30, up from roughly 6.2 million in 2016. The portal replaces decades-old mail- and fax-based processes; borrowers who consolidate can access a temporary 1% interest rate reduction via auto pay enrollment. Treasury Secretary Scott Bessent cited "fiscal responsibility" for the $1.7 trillion federal student loan portfolio. Since the Treasury-ED partnership launched under six months ago, approved rehabilitation applications rose 69% and consolidations out of default rose 95%. The default surge follows the expiration of the Covid-era payment pause, the collapse of the Biden administration's SAVE plan and rising unemployment among recent graduates. New York Fed data show the student loan delinquency rate reached 10.3% of balances 90-plus days overdue in Q1 2026, up from 9.6% at end-2025.