Department of Education to Resume Collection of Federal Student Loans in Default

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Summary

Education Department to resume collecting student loans in default

The Department of Education announced on Monday that it will restart collecting federal student loans in default on May 5, ending a pandemic-era pause that began roughly five years ago.

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Yahoo!

Education Department to resume ‘involuntary collections' of defaulted student loans

After the Covid pandemic-era pause on federal student loan payments expired in September 2023, the Biden administration offered borrowers another year in which they would be shielded from the impacts of missed payments.

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NBC Chicago

Education Department to resume collections on defaulted federal student loans for first time since 2020

While the first Trump administration paused referring federal student loans to collections in March 2020 at the onset of the COVID-19 pandemic, the extended lapse has prompted Trump administration officials to worry that the federal student loan portfolio is "headed toward a fiscal cliff if we don't start repayment in collections," according to a senior department official.

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Fox News

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News Results

Trump Admin Says It Will Collect Defaulted Student Loans From Borrowers' Wages: 'The Federal Government Can And Will'

White House Press Secretary Karoline Leavitt said the government can and will collect defaulted federal student loan debt by withholding tax refunds, federal pensions, and even their wages. The student loan portfolio controlled by the federal government is nearly $1.6 trillion, but fewer than 4 in 10 borrowers are in repayment. There have been no referrals for collection since March 2020, when Trump paused payments.

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9m ago

DoE to Restart Involuntary Student Debt Collection After Pandemic Pause

The Office of Federal Student Aid (FSA) will officially resume collections of its defaulted federal student loan portfolio on May 5. By summer, FSA will send notices before beginning administrative wage garnishment, according to DoE. DoE noted that it has not collected on defaulted loans since March of 2020, and while Congress mandated borrower repayment in Oct. 2023.

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10m ago

Department of Education to resume collecting student loan payments. Here's what to know

A press release from the Department of Education says student loans collections will resume. Here's what to know if you are a borrower in default.

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9m ago

Department of Education to resume collections on defaulted student loans

The department has not collected on defaulted loans since the start of the COVID-19 pandemic in March of 2020. Those in default could have their wages, social security checks, tax refunds and more garnished.“This is a terrible sign of the chaos to come for working people that have student debt,” said Mike Pierce, executive director and co-founder of the Student Borrower Protection Center.

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9m ago

Department of Education Will Restart Student Loan Collections in May

More than 5 million student loan borrowers are in default and an additional 4 million are in late stage delinquency. The Federal Student Aid (FSA) will place them in administrative wage garnishment. This means up to 15% of their income could be withheld from their paycheck and sent to their loan holder.

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9m ago

What to know as Department of Education plans to resume collections on student loans

Over 5 million borrowers are in default, and another 4 million are severely delinquent. Congress authorized the post-pandemic resumption of student-loan payments in October 2023. But the collections pause was never formally lifted, the Department of Education said. A communications and outreach campaign will be paired with the resumption.

MIDDLE

9m ago

Student Loan Update: Trump Gives New Deadline for Garnishing Wages

The Education Department announced Monday that it will resume collection efforts on defaulted federal student loans starting in May. The move follows the expiration of payment pauses and grace periods that began in 2020 under the Biden administration and lasted through late 2024. Currently, about 5.3 million borrowers are already in default, and another 4 million are seriously delinquent.

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9m ago

Education Department to resume collections on student loans

The U.S. Department of Education will be resuming collections on defaulted student loans in May, the White House said Tuesday.

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10m ago

Education Department to resume federal student loan collections

A senior Administration official said student loan debt "must be repaid." Collections had been suspended since 2020.

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10m ago

Something big is happening to defaulted student loans May 5

U.S. Department of Education will resume collecting on defaulted federal student loans. Department has not collected since start of COVID-19 pandemic in March 2020. Office of Federal Student Aid will reinstate tools such as Treasury Offset Program. Officials say return of collections is necessary to protect American taxpayers.

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10m ago

What student loan borrowers need to know about ‘involuntary collections'

U.S. Secretary of Education Linda McMahon explains the new policy. Borrowers who don't make payments on time will have their wages automatically garnished. The government will begin moving roughly 1.8 million borrowers into repayment plans on May 5, she says. The new policy will apply to all federal student loans.

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10m ago