You are currently viewing Student Debt Collections Restart on May 5. Here’s What to Know.

After a five-year reprieve, the Trump administration will restart forced collections on federal student loans in default, which could include garnishing a portion of borrowers’ paychecks.

With collections in place, the last piece of the student loan machinery has been turned back on, officially ending pandemic-era relief, which began when President Trump paused federal student loan payments in March 2020.

The Biden administration extended the freeze several times, and payments resumed only in October 2023. But the rules were relaxed for the first year of repayment, and borrowers weren’t penalized for slipping behind until last fall.

Now that those penalties have begun to appear, borrowers who fell behind are beginning to see their credit scores plunge, including more than five million borrowers in default and many millions more projected to be on the precipice.

At the same time, the Biden-era repayment program known as SAVE — which ties a borrower’s loan payments to

Keep reading this article on The New York Times Your Money.

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