This week, the U.S. Department of Education resumed collecting on defaulted federal student loans, which were paused during the COVID-19 pandemic. Approximately 195,000 borrowers will receive notices indicating their federal benefits may be garnished for unpaid debts. By summer, all 5.3 million borrowers in default will be informed of the possibility of administrative wage garnishment. The Department accuses the Biden administration of continuing the collections pause. Education Secretary Linda McMahon emphasized accountability to taxpayers in relation to student loan policies.
Many Americans could soon be bringing home lighter paychecks as the result of a Trump administration policy that officially went into effect this week.
The Department of Education says all 5.3 million borrowers who have defaulted on their loans will have been notified that they could be subject to "administrative wage garnishment."
American taxpayers will no longer be forced to serve as collateral for irresponsible student-loan policies," Education secretary Linda McMahon said in a statement last month.
Most federal student loans are considered to be in default if a borrower hasn't made a payment in more than 270 days, a status that gets reported to credit bureaus.
Collection
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