Starting this month, those who are delinquent on their federal student loans will encounter more stringent repercussions, including potential wage garnishment and interruptions to federal benefits.
Breakdown
- The Department of Education will resume interest accrual on student loans and enforce stricter penalties for delinquencies.
- Several repayment plans are being phased out by July 2028, and pending litigation may accelerate repayment requirements. 19s
- Borrowers more than 270 days delinquent may face wage garnishment of up to 15% of take-home pay. 1m 51s
- A recent study shows 31% of borrowers are over 90 days past due, with 1.8 million at risk of default. 1m 59s
- Financial advisors urge borrowers to contact loan servicers, consider income-driven repayment, and monitor credit to avoid further consequences. 2m 28s