The Trump administration will resume wage garnishments for defaulted student loan borrowers starting January 2026, ending the Biden-era pause on collections while advocacy groups cry foul over the return to fiscal responsibility.
Story Highlights
- Trump administration to begin wage garnishments for 1,000 defaulted borrowers starting January 7, 2026
- Over 5 million borrowers are currently in default, with 4 million more expected to follow
- Biden’s mass loan forgiveness schemes have been repeatedly struck down by courts, including the Supreme Court
- New Trump legislation eliminated multiple repayment programs and borrowing caps
Trump Restores Accountability to Student Loan Program
The Trump administration will begin sending wage garnishment notices to approximately 1,000 defaulted student loan borrowers during the week of January 7, 2026.
The Education Department confirmed it will pursue involuntary collection only after providing borrowers sufficient notice and repayment opportunities. This marks a return to enforcing existing loan obligations after years of Biden administration extensions and failed forgiveness schemes that created moral hazard.
Student loan borrowers in default may see wages garnished in 2026 https://t.co/ea5Ha8ECZ8 pic.twitter.com/DnWlbkU5ym
— Orlando Sentinel (@orlandosentinel) December 23, 2025
Massive Default Crisis Inherited from Biden Policies
More than 5 million borrowers were already in default when the Education Department announced the resumption of collections in May 2025. Officials predict an additional 4 million borrowers could default in the coming months, potentially bringing the total to nearly 25% of all student loan borrowers.
This crisis stems directly from the Biden administration’s mixed messaging about loan forgiveness, which encouraged borrowers to avoid repayment while awaiting bailouts that courts repeatedly rejected.
Federal borrowers enter default status after missing payments for 270 days or more. The Treasury Department’s offset program will withhold tax refunds, federal salaries, and Social Security benefits from those who fail to address their obligations.
Borrowers receive at least 30 days’ notice before wage garnishment begins, providing ample opportunity to arrange payment plans.
Biden’s Failed Forgiveness Schemes Created the Current Mess
Former President Biden’s attempts to forgive student debt for tens of millions of borrowers were repeatedly struck down by federal courts, including a decisive 2023 Supreme Court ruling.
While Biden managed to wipe out debt for 5 million borrowers through existing forgiveness programs, his broader schemes violated constitutional separation of powers and fiscal responsibility. These failed promises left millions of borrowers confused about their obligations and contributed to the current default crisis.
Student loan advocacy groups predictably attacked the Trump administration’s return to fiscal responsibility. Persis Yu from Protect Borrowers called wage garnishment “cruel, unnecessary, and irresponsible,” ignoring that borrowers voluntarily accepted these loan terms.
Such rhetoric encourages borrowers to shirk legitimate obligations while demanding that taxpayers foot the bill for others’ educational choices.
Comprehensive Reform Eliminates Biden-Era Loopholes
President Trump’s comprehensive student loan reform, signed into law on July 4, 2025, eliminated several problematic repayment programs, including SAVE, PAYE, IBR, and ICR. The legislation also established borrowing caps for higher education and removed economic hardship deferment provisions that were routinely abused.
Education Secretary Linda McMahon emphasized the department will “shepherd the student loan program responsibly and according to the law” while helping borrowers return to repayment for their financial health and the nation’s economic stability.
The administration made clear there will be no mass loan forgiveness under Trump’s leadership. This stance restores integrity to the federal lending system and ensures borrowers understand their obligations are absolute.
By eliminating the moral hazard created by Biden’s forgiveness promises, the Trump administration encourages responsible borrowing decisions and protects taxpayers from subsidizing others’ educational debt.
