Washington– The Trump administration said Tuesday it will begin garnishing wages for defaulting student loan borrowers early next year.
The department said it will send notices to approximately 1,000 borrowers the week of Jan. 7, with more notices arriving on an increasing scale each month.
Millions of borrowers are considered in default, meaning they are 270 days behind on their payments. The department must give borrowers 30 days’ notice before their wages are garnished.
The department said it would begin collection activities, “only after providing students and parent borrowers with sufficient notice and an opportunity to repay their loans.”
In May, the Trump administration ended the pandemic-era pause on student loan payments and began collecting delinquent debt by withholding tax refunds and other federal payments from borrowers.
The move ended a period of leniency for student loan borrowers. Payments were resumed in October 2023, but the Biden administration extended a grace period by one year. Since March 2020, no federal student loans, including defaulted loans, have been referred for collection, until the Trump administration’s changes earlier this year.
The Biden administration tried several times to grant broad student loan forgiveness, but those efforts were eventually blocked by the courts.
Persis Yu, deputy executive director of the Student Borrower Protection Center, criticized the decision to begin wage garnishment and said the administration failed to adequately help borrowers find affordable payment options.
“At a time when families across the country are struggling with stagnant wages and an affordability crisis, this administration’s decision to garnish wages from distressed student loan borrowers is cruel, unnecessary, and irresponsible,” Yu said in a statement. “While millions of borrowers stand on the brink of default, this administration is using its limited, self-imposed resources to seize borrowers’ wages rather than defending borrowers’ right to affordable payments.”
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