Borrowers who have fallen significantly behind on their federal student loans could see their take-home pay shrink as soon as next month. The Trump administration is set to begin garnishing the wages of borrowers in default starting in January, the Department of Education confirmed to CNN on Tuesday.
This enforcement step marks a major escalation in the government’s efforts to recover unpaid federal student aid.
It comes months after the administration restarted the collections process for defaulted loans—a status applied to accounts that have gone at least 270 days without a payment.
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Under the mechanism known as administrative wage garnishment, the Education Department utilizes its authority to order non-federal employers to withhold a specific portion of an employee’s income. That money is then sent directly to the government to pay down the debt.
The crackdown could affect a massive number of Americans. In April, the department reported that over 5 million borrowers were in default.
Additionally, nearly 4 million more were classified as delinquent, meaning they had failed to make a payment in more than 90 days but had not yet reached the default threshold.
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While the administration had already resumed general collections activities, the move to garnish wages represents a more aggressive phase of enforcement for those who have not brought their accounts back into good standing.
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