Involuntary collection of defaulted student loans to resume, Education Department says

The U.S. Department of Education on Monday said it’s restarting “involuntary” repayment of federal student loans that are in default.

The payments were paused during the first term of President Donald Trump in 2020 as a response to the Covid pandemic.

“Beginning May 5, the department will begin involuntary collection through the Treasury Department’s offset program, which withholds payments from the government — including tax refunds, federal salaries and other benefits — from people with past-due debts to the government,” the department said in a statement.

Wages will be garnished following a 30-day warning, it added.

An estimated 5.3 million borrowers are in default on their federal student loans, though the department said that number could reach 10 million in a few months. Repayment will be administered by the U.S. Department of Treasury, and affected borrowers will get notices in the next two weeks, the department said in a statement.

The administration of President Joe Biden continued to pause repayment under a campaign promise to relieve student debt, but the U.S. Supreme Court ruled in 2023 his plan was not constitutional because it did not fall under congressional approval.

“American taxpayers will no longer be forced to serve as collateral for irresponsible student loan policies,” said U.S. Secretary of Education Linda McMahon. “The Biden Administration misled borrowers: the executive branch does not have the constitutional authority to wipe debt away, nor do the loan balances simply disappear.”