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What student loan borrowers should do when faced with wage garnishment

Gone are the days when defaulted student loan borrowers could ignore collection actions without consequence. Starting January 7, 2026, the federal government will begin garnishing wages for borrowers in default after more than 270 days past due. Initial notices will be sent to around 1,000 borrowers, but the number of notices is expected to grow steadily throughout 2026 as additional defaults are processed. Even if your current balance feels overwhelming, waiting will only de

Federal student loan wage garnishment is back and set to begin the week of January 7, 2026 , according to recent federal announcements. Notices will go out to borrowers in default, and if you don’t act quickly, your employer could be asked to withhold part of your paycheck to repay defaulted federal student loans. This is a seismic shift from the pandemic-era relief many borrowers experienced. After years of payment breaks, federal collections are resuming and could impact mi

Rehabilitation is one of the most powerful tools borrowers can use to get out of federal student loan default. It allows you to make a series of affordable monthly payments based on your income. Most borrowers qualify for payments as low as five dollars per month. Once you complete the required number of payments, your loan leaves default, collections activity stops, and your credit report updates to show the account in good standing. Rehabilitation can also remove wage garni

Next in our default series, we're discussing the implications of default and the financial consequences many Americans are facing in the coming months unless they take action to resolve their delinquencies. Once a federal student loan enters default, the government can collect the balance using powerful enforcement tools. Two of the most common are wage garnishment and tax refund offset. Wage garnishment allows the government to require your employer to send a portion of your

Default is a big problem affecting millions of Americans. In this week's blog series we'll cover what options borrowers have when it comes to getting out of default and avoid garnishment. Falling behind on your student loans can feel overwhelming, but understanding what happens in default is the first step toward taking back control. Federal student loans enter default after 270 days of missed payments. At that point the entire balance becomes due, collection costs can be add

With ongoing changes across the federal student loan system, one of the simplest yet most overlooked steps borrowers can take is confirming who currently services their loans. Servicing transfers have become increasingly common over the last two years, especially with major updates to repayment programs and account adjustments. But many borrowers only discover their servicer has changed after a missed payment, a delayed update, or an unexpected notice. Staying ahead of these

When life gets overwhelming, student loan payments are often the first thing borrowers fall behind on. But letting those payments slide for too long can snowball into something much more serious: default. The good news? Even if you’re struggling or already past due, you still have options. Income-driven repayment (IDR) programs can help you avoid default, protect your financial health, and get back on track often with payments that fit your budget. Let’s break down what defau

After months of uncertainty, long-term Income-Driven Repayment (IDR) borrowers finally have good news. A recent settlement in AFT v. U.S. Department of Education clears the path for the Department to restart forgiveness for borrowers in Pay As You Earn (PAYE), Income-Contingent Repayment (ICR), and other qualifying IDR plans. One of the biggest benefits in the agreement:If you qualify for forgiveness by December 31, 2025, your forgiven balance will stay federally tax-free eve

The holidays are here. Travel , gifts, family gatherings, and more spending than usual. For millions of federal student loan borrowers, this season can also bring stress, especially with payments, late notices, or uncertainty about what you qualify for. The good news? A few simple steps now can make your January far easier. Here’s how to stay in control this holiday season and start the new year with a clear plan. 1. Get Clear on Your Student Loan Status Before the holiday r

Big recent moves in the federal student loan world mean it’s more important than ever to stay informed and proactive. Here are three headline-changes and how you should respond to each. The One Big Beautiful Bill Act (OBBBA) is heading into major rule-making. The U.S. Department of Education has concluded a negotiated rule-making session tied to the law, which aims to simplify repayment plans and reshape graduate loan limits. The Department of Education has issued a final rul

Are you struggling with student loan debt and wondering if forgiveness is an option? Let's dive into the basics of Income-Driven Repayment (IDR) forgiveness, a key pathway for many federal loan borrowers. IDR plans are designed to make your monthly payments affordable based on your income and family size. The incredible benefit? After a certain number of qualifying payments – typically 20 or 25 years – any remaining balance on your federal student loans can be forgiven! Even

Public Service Loan Forgiveness (PSLF) continues to be a life-changing opportunity for dedicated public servants across the nation. Imagine: after 120 qualifying payments, your remaining federal student loan debt could be completely forgiven! But navigating the specific eligibility criteria is the crucial first step on this impactful journey. As of November 2025, the fundamental requirements remain steadfast: you must be employed full-time by a qualifying employer. This inclu

For today's student loan update, let's tackle one of the biggest repayment mistakes: ignoring your options and falling behind . The student loan landscape can be complex, and many borrowers mistakenly believe they have no flexibility once payments begin. This couldn't be further from the truth! A common costly mistake is defaulting on your loans because you're struggling to pay. Instead of letting this happen, proactive communication with your loan servicer is key. Federal st

Heads up, student loan borrowers! The popular SAVE (Saving on a Valuable Education) plan is officially phasing out. This isn't just a policy update; it's a call to action to protect your financial stability! Many borrowers currently enjoying the benefits of SAVE could see a significant jump in their monthly bills once the program officially concludes early next year. If you've been relying on SAVE for manageable payments, it's absolutely crucial to start exploring alternative

For most federal student loan borrowers, the best path to reducing student loan payments is an Income-Driven Repayment (IDR) plan. These plans are a cornerstone of federal student aid, calculating your required monthly payment based on your income and family size, rather than your loan balance. The Big Four IDR Plans The goal of IDR plans is to ensure your payment is affordable, often capping it at a percentage of your discretionary income. The four main IDR plans are: Saving