After several years of pause, the U.S. government has announced that starting next month, it will resume collecting unpaid student loan debt — even through wage garnishment.
According to the Department of Education, the measure targets over five million individuals who are not repaying their student loans, as well as four million more who have substantial delays in repayment.
In 2020, during his first term, Donald Trump had suspended the collection of the massive student loan debt burdening many households, as part of measures to support American consumers during the Covid-19 pandemic.
This pause was later extended by President Joe Biden, who made multiple attempts to cancel a large portion of student debt. However, in 2023, the U.S. Supreme Court, with a strongly conservative composition shaped during Trump’s presidency, struck down parts of these relief efforts.
Education Secretary Linda McMahon justified the resumption of student debt collection by stating that the government “does not have the constitutional authority to cancel the debt” and condemned what she described as the “irresponsible policies” of the Biden administration.
Those affected will receive official notification via email within two weeks, the Department of Education announced, adding that wage garnishments will begin in the summer. Collection will also occur through the withholding of certain social benefits and tax refunds.
The announcement was heavily criticized by the Student Borrower Protection Center, an organization representing and advocating for student loan borrowers. In a statement, the group denounced the move as harsh and damaging, warning it would plunge working families into even deeper financial hardship.
In the U.S., college education can cost anywhere from $10,000 to $70,000 per year, often leaving graduates burdened with crushing debt as they start their careers. According to the Department of Education, 42.7 million people owe a total of $1.6 trillion in student loans.
According to Pew Research Center, one in four American adults under 40 owed between $20,000 and $25,000 on average in student loan repayments in 2023.
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