Overview

• The Department of Education will restart collections on defaulted federal student loans on May 5, affecting over 5 million borrowers currently in default.
• Borrowers in default may face garnishment of wages, federal tax refunds, and Social Security benefits, with wage garnishment beginning later this summer after a 30-day notice.
• Officials emphasize this policy shift as a measure to protect taxpayers, stressing that no mass loan forgiveness will be offered under the current administration.
• Borrowers have two weeks to contact the Default Resolution Group to explore repayment options such as income-driven plans or loan rehabilitation to avoid involuntary collections.
• Women, who hold nearly two-thirds of the nation’s $1.6 trillion student debt, are expected to be disproportionately impacted by resumed collections.