After a five-year pause, the Trump administration is restarting collections on defaulted student loan debt. Some 9 million borrowers could face severe financial consequences as a result in the next few months, including garnishing federal tax refunds, Social Security benefits, federal pensions, and wages.
The Department of Education will resume collections on defaulted student loans starting May 5, it announced this week. The department has not collected on defaulted loans since March 2020, when a host of changes were made to loan collection and billing to help borrowers during the Covid-19 pandemic.
