The Trump administration announced Tuesday that it will restart wage garnishment for federal student loan borrowers in default beginning early next year. The move marks the first resumption of the enforcement tool since the pandemic-era pause and could affect millions of Americans with unpaid debt.
Under plans released by the U.S. Department of Education, notices will begin going out the week of Jan. 7, 2026. About 1,000 borrowers who are more than 270 days delinquent on their loans will be notified first, with the number of notices increasing each month.
The department said wage garnishment will occur only after borrowers have been given at least 30 days’ notice and a chance to repay their loans or seek alternatives.
“Student and parent borrowers will be provided sufficient notice and opportunity to repay their loans,” the department said in a statement.
Federal law allows the government to withhold up to 15 percent of a borrower’s after-tax income once garnishment begins. The money is applied directly to the defaulted loan balance until the debt is fully repaid or another arrangement is reached.
A Shift in Enforcement
Borrowers enter default status after missing payments for at least 270 days. Default triggers stronger collection tactics, including wage garnishment and offsets of tax refunds and other federal payments.
Student loan payments were paused early in the COVID-19 pandemic and remained free from enforcement for years as part of broad relief. The pause officially ended in May 2025 under the current administration. The restart of collections, beginning with tax and benefit offsets earlier this year, set the stage for wage garnishments.
The Education Department has said it delayed the wage garnishment rollout in part because of procedural challenges, including the need to update systems dormant since 2020.
Advocates for borrowers quickly criticized the plan, saying it fails to account for broader financial pressures on households. Persis Yu, deputy executive director of the Student Borrower Protection Center, called the policy “cruel, unnecessary, and irresponsible.”
“At a time when families across the country are struggling with stagnant wages and an affordability crisis, this administration’s decision to garnish wages from defaulted student loan borrowers is cruel, unnecessary, and irresponsible,” Yu said in a statement. “This administration is using its self-inflicted limited resources to seize borrowers’ wages instead of defending borrowers’ right to affordable payments.”
Education Secretary Linda McMahon has defended the shift, saying it reflects adherence to federal law and will help stabilize the federal loan system. She has criticized prior forgiveness and relief efforts as lacking legal authority.
Proponents of the policy argue that resuming wage garnishment will help recover billions in unpaid debt and reduce taxpayer subsidies for delinquent loans.
More than 5 million federal student loan borrowers are currently in default, according to recent federal data, with several million more delinquent but not yet in default.
The rollout on Jan. 7 will be the first test of the administration’s enforcement plans and is likely to draw close attention from borrowers, lawmakers and advocacy groups as 2026 unfolds.