All articles tagged with #wage garnishment
The Trump administration announced it will start garnishing wages of defaulted student loan borrowers early next year, beginning with notices to about 1,000 borrowers in January, as part of efforts to recover debt after ending a pandemic-era payment pause. Critics argue this move is harsh amid economic struggles, while the administration emphasizes providing notice and opportunities for repayment.
The Trump administration will begin garnishing wages of about 1,000 defaulted student loan borrowers starting in January, as part of a broader effort to increase debt collection following the end of a repayment pause and changes to repayment plans, affecting millions of borrowers with over $1.6 trillion in federal student debt.
The Trump administration will begin garnishing the wages of defaulted student loan borrowers starting in January, affecting around 1,000 people initially, with the number expected to rise. The government can seize up to 15% of a borrower's after-tax income, leaving them with at least $217.50 weekly, as part of its efforts to recover federal debts amid a rising default rate among over 42 million student loan holders with more than $1.6 trillion in debt.
Wage garnishment for defaulted student loans is set to resume early next year, signaling a return to debt collection efforts for borrowers who have defaulted on their loans.
The article discusses recent developments in student loan debt collection, including wage garnishments by the Trump administration, and explores how employers can support employees with student debt through benefits like retirement match contributions, PTO exchanges, financial counseling, and educational assistance programs, which could help improve financial wellbeing and reduce stress.
Nearly 2 million federal student loan borrowers could face wage garnishment this summer due to missed payments after pandemic relief ended, with defaults rising and credit scores dropping, prompting warnings from the Education Department and highlighting the ongoing debt crisis.
The US government is intensifying efforts to collect on defaulted federal student loans through wage garnishment and Treasury Offset, potentially affecting over 10 million borrowers, while recent legislation threatens to increase payments for millions enrolled in the SAVE plan, delaying loan forgiveness and raising financial burdens.
Federal student loan borrowers who default on their loans may face wage garnishments and other financial penalties, such as losing eligibility for certain mortgages. Borrowers are advised to address payment issues early by exploring options like deferment, forbearance, or income-driven repayment plans, which can prevent default and its consequences. Once in default, borrowers must undergo a loan rehabilitation process to access more affordable repayment options.