The Trump administration will resume wage garnishment for borrowers with defaulted federal student loans beginning in January 2026, restarting a collection tool that has been largely dormant since the start of the COVID-19 pandemic nearly six years ago.
The move could ultimately affect more than 5 million Americans who have not made payments on their federal student loans for at least 270 days, the point at which a borrower is considered in default under federal law.
Under wage garnishment rules, the federal government may withhold up to 15% of a borrower’s after-tax pay without a court order. Most collection activity, including garnishment, was paused in March 2020 as part of pandemic-era relief and remained largely inactive through subsequent extensions under the Biden administration.
The Education Department said it will begin the process by sending notices during the week of Jan. 7 to roughly 1,000 borrowers with defaulted loans. Those borrowers will receive at least 30 days’ notice before any money is withheld from their paychecks. Officials said the number of notices will increase month by month throughout 2026.
Roughly 5.3 million borrowers currently meet the criteria for default.
The department said restarting wage garnishment and other collection efforts, including the seizure of tax refunds and certain federal benefits, is necessary to enforce existing law and protect taxpayers.
It adds that the measures are not new, noting they have long been part of federal loan enforcement policy to ensure borrowers meet their obligations and that taxpayers are not ultimately left to cover the costs.
Under Secretary of Education Nicholas Kent has repeatedly emphasized that position as the administration unwinds Biden-era student loan relief policies. Kent has said the law leaves little room for discretion when borrowers remain in default.
“The law is clear: if you take out a loan, you must pay it back,” Kent said in a recent departmental release. He has framed the policy shift as restoring contractual accountability and fairness to taxpayers, many of whom did not attend college or have already repaid their own student loan debt.
Borrower advocacy groups criticized the decision, arguing it could worsen financial hardship for Americans already under pressure from high living costs, declining purchasing power, and broader economic uncertainty.
“This administration’s decision to garnish wages from defaulted student loan borrowers is cruel, unnecessary, and irresponsible,” said Persis Yu, deputy executive director of the Student Borrower Protection Center. Yu and other critics said wage garnishment could destabilize households that are struggling to keep up with rent, food, and other basic expenses.
Advocates of student loan relief argue that federal education debt is uniquely punitive, noting that student loans are among the few major forms of consumer debt that generally cannot be discharged in bankruptcy absent a showing of “undue hardship,” a legal standard courts rarely grant. They also point to decades-long tuition increases that have far outpaced inflation and wage growth, leaving many borrowers with balances they say are impossible to manage.
Supporters of the administration’s approach counter that loan repayment is a contractual obligation and that allowing widespread defaults shifts costs onto taxpayers. They argue that resisting garnishment effectively amounts to endorsing higher taxes or reduced public services to cover unpaid debt.
Borrowers in default still have options to avoid wage garnishment. They may pursue loan rehabilitation, consolidate their loans, or negotiate a repayment plan with their loan servicer. Borrowers also have the right to request a hearing to contest garnishment before it begins.
Even with those safeguards, the policy carries political risk. Millions of borrowers struggling with affordability could feel the impact directly in their paychecks, potentially alienating younger voters and college-educated Americans ahead of the 2026 midterm elections. Republicans made gains among younger voters in 2024, and strategists on both sides are watching closely to see how the issue reshapes turnout and political loyalties.
For now, borrowers with federal student debt are being urged to monitor their mail and take action if they receive a notice. Information about repayment options and default resolution is available through loan servicers or the Default Resolution Group on the Federal Student Aid website.
As collection activity ramps up in the new year, the resumption of wage garnishment marks a clear shift in federal student loan policy, one that places renewed emphasis on repayment and enforcement after years of pandemic-era relief.
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IT IS ABOUT TIME!!!!! NO ONE FORCED THEM TO TAKE OUT THESE LOANS and THE TAX PAYERS SHOULD NOT TAKE ON “THEIR DEBTS”!
You borrow the money you pay to loan. groups calling hardship have no standing. I paid all my loans. I as a taxpayer am tired of supporting those that want everything for free including those on free medical, housing, money, etc. Pay you own way. I have worked all my life and now retired and you want my money, no thanks.