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Update on the Department of Education’s Third-Party Servicer Guidance

"As the Department of Education (Department) strives to make postsecondary education more affordable and student loans more manageable than ever before, we are also working to identify and remedy the root causes of unaffordable debts. President Biden has called for a postsecondary education system that’s not only more affordable, but more accountable to students, families, and taxpayers. For many families, an education beyond high school is among the most expensive and important purchases they will make in their lifetimes, as the quality and value of an individual’s postsecondary experience plays an immense role in their lifetime earnings and career options.

 

Earlier this year, the Department released Dear Colleague Letter GEN-23-03 to bring more transparency into the contractors who work closely with institutions of higher education (institutions) on Title IV program management and delivery, particularly in the critical areas of recruitment and marketing. The Dear Colleague Letter stated which services would be considered activities of third-party servicers, a designation that offers additional transparency into the work of these companies. This included categories of activities identified in previous guidance and several new categories of services that constitute the administration of Title IV aid programs. This transparency gives the Department the ability to ensure that all entities engaged in the administration of Title IV aid programs are complying with applicable Federal laws and regulations. " - James Kvaal, U.S. Department of Education

The full blog post goes into more detail which you can find here.

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