Student Loan Wage Garnishment: What Borrowers Need To Know

Millions of Americans face student loan wage garnishment this summer. The Department of Education is resuming the collection of defaulted federal student loans, impacting 5.3 million borrowers. The process allows the government to seize up to 15% of an individual's after-tax income. However, there are legal protections in place to ensure borrowers retain a minimum weekly income of 30 times the federal minimum wage. "The Treasury Department will send notices to these borrowers later this summer," explains a CNBC report. Borrowers will receive a 30-day notice before any funds are seized, and they have the right to challenge the garnishment with the Department of Education. This development is significant, as it marks the resumption of involuntary collections after a pandemic-related pause. The process is already familiar to many employers, but for those affected, understanding their rights and the legal limitations is crucial. For more information, resources are available online.