Wed Dec 24 15:40:00 UTC 2025: FOR IMMEDIATE RELEASE
Trump Administration to Resume Wage Garnishment for Defaulted Student Loan Borrowers in January
Washington, D.C. – The Trump administration will begin garnishing the wages of student loan borrowers in default starting in January, the Department of Education announced Tuesday. The move comes months after the administration restarted collecting federal student loans in default, which occurs after 270 days without payment.
The Education Department said it would begin sending notices to approximately 1,000 borrowers the week of January 7, with the scale of garnishments increasing on a month-to-month basis. The process, known as administrative wage garnishment, allows the government to order employers to withhold a portion of an employee’s income to repay defaulted student loans.
This action could potentially affect millions of borrowers, as the department reported in April that over 5 million borrowers were in default and nearly 4 million more were delinquent, meaning they had not made a payment in more than 90 days. The government also recently resumed the Treasury Offset Program, garnishing federal and state payments like tax returns and Social Security benefits to recoup defaulted debts.
Critics of the move argue that resuming wage garnishment will place additional financial strain on borrowers already struggling with higher costs. “As millions of borrowers sit on the precipice of default, this Administration is using its self-inflicted limited resources to seize borrowers’ wages instead of defending borrowers’ right to affordable payments,” Protect Borrowers Deputy Executive Director Persis Yu said in a statement.
The announcement comes amidst a series of significant changes to the student loan landscape. The Trump administration’s “One Big Beautiful Bill Act” placed new caps on borrowing for graduate students and parents, eliminated certain loan deferments, and created a more limited set of repayment options. Further, the administration recently reached an agreement to end the SAVE plan, a Biden-era repayment plan, pending federal court approval.
Borrowers in default are no longer eligible for deferment or forbearance, nor can they choose a repayment plan. The Department of Education has urged borrowers to contact the student aid office’s Default Resolution Group. The department also notes that borrowers facing severe financial hardship may be able to discharge their loans in bankruptcy if they meet specific criteria.
First Piper 