A new era for student loans begins with garnished wages on the table
by Lexi Lonas Cochran - 05/04/25 6:00 AM ET
Starting Monday, student loan borrowers who find themselves in default will face government-backed involuntary collections, signaling a brand new landscape after years of pauses, delays and Biden-era relief efforts.
Garnished tax returns, Social Security payments and even wages will all be fair game on May 5 after a five-year pause on severe financial consequences that began during the economic upheaval of the COVID-19 pandemic.
The Trump administration has made clear no additional debt forgiveness will be offered to borrowers as congressional Republicans look to revamp the student loan repayment system.
For those who “have been unable to keep up with their loans, the resumption of involuntary elections is going to be catastrophic,” said Aissa Canchola Bañez, policy director for Student Borrower Protection Center.
“We’re literally seeing the folks who can least afford it being penalized with this change,” Bañez said.
Borrowers who are struggling with their student loans are put into delinquency after 90 days of missed payments, affecting credit scores.
After 270 days, borrowers are put into default, which presents more serious financial consequences such as involuntary collections from their paychecks or difficulty securing future loans.
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https://thehill.com/homenews/education/5279819-student-loans-payments-default-relief-forgiveness-garnished-wages-trump-mcmahon-biden/
