The Trump administration is set to start taking pay from those with student loans in default from January.
Over 5 million people with student loans are already in default, but the Education Department said that could be expected to grow to 10 million, while a total of over 42 million hold student loans in general; a total debt of approximately US$1.6 trillion.
Now, a spokesperson from the Department has confirmed that wage garnishing will begin on those in default as soon as next month.
This will see federal tax refunds, pay, Social Security retirement and disability benefits of those in default all open to being seized by the federal government to put towards their debt, for the first time in over five years, when the start of the COVID pandemic saw the practise stopped.
The Education Department will be permitted to take up to 15% of a student loan holder’s income, after tax.
