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Federal student loan payments, collections resume after 5-year pause
- The U.S. Department of Education restarted efforts to collect on federal student loans in default starting Monday, ending a suspension of collections that had been in place since March 2020 due to the COVID-19 pandemic.
- This pause halted collection efforts to provide relief during the pandemic, but now roughly 5.3 million borrowers in default and about 4 million severely delinquent borrowers face resumed repayments and potential penalties.
- The Education Department advises borrowers in default to reach out to its Default Resolution Group, make regular monthly payments, consider income-driven repayment options, or pursue loan rehabilitation programs as ways to address defaults and prevent wage garnishment or tax refund seizures.
- An official advised borrowers to document payment efforts, warning that collection notices and emails will arrive in the coming weeks and garnishment notices may be sent this summer to those who do not repay.
- Resuming collections aims to protect taxpayers from loan costs while putting financial pressure on millions of borrowers, including retirees, signaling increased enforcement of federal student loan repayment obligations.
37 Articles
37 Articles
5.3M Americans could see shrinking paychecks due to student loan debt
More than 5 million Americans who are behind on student loan payments could face serious consequences by the end of this summer. On Monday, May 5, the Department of Education announced that about 195,000 borrowers received a notice saying they had defaulted on their student loans and giving them a 30-day notice that they risk facing consequences. The department said that by the end of the summer, 5.3 million Americans will receive the same notic…
Worried About Wage Garnishment for Student Loans? Here’s How to Protect Your Paycheck!
If you’ve been keeping up with student loan news, you might have heard that collections are back. After five years of a pause, the U.S. Department of Education is starting to collect on defaulted federal student loans again. I know, it’s stressful to think about, but don’t freak out just yet! Getting behind on payments doesn’t automatically mean your wages will be garnished, and there are ways to avoid it. Let’s break it down. Who’s Affected by …
Student loan collections resume after five-year pause - Asian Journal News
WASHINGTON, D.C. — The U.S. Department of Education has officially resumed collections on defaulted federal student loans as of May 5, 2025, ending a pandemic-era relief that shielded millions of borrowers from financial penalties for over five years. The move affects approximately 5.3 million Americans whose loans are currently in default and comes amid a broader reorientation of federal student…
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