Federal Student Loan Collections Are Back—Now What?
“The pause is over. Now is the time to protect your paycheck and your peace of mind.”
Introduction:
As of May 5, the U.S. Department of Education has officially resumed collections on defaulted federal student loans—ending a pause that’s been in place since March 2020. For many borrowers, this change is more than just a policy shift—it’s a wake-up call.
If you’ve fallen behind on your federal student loans or have been in default for years, here’s what you need to know and what you can do right now to protect your income, avoid garnishments, and start moving forward.
🔹 What Changed on May 5?
During the pandemic, federal student loan collections were temporarily paused. That meant no wage garnishments, no tax refund seizures, and no aggressive calls from collection agencies.
But now, that pause is over. If your loans are in default, the government can resume collecting what you owe through:
Wage garnishment (taking money directly from your paycheck)
Seizing tax refunds
Withholding Social Security payments
Sending your loan to collections
🔹 Am I Affected?
You are affected if:
You have federal student loans in default
You haven’t made a payment in more than 270 days
You received notice that collection activity will resume
If you’re unsure whether your loans are in default, visit studentaid.gov and log into your account to check your status.
🔹 What You Can Do Right Now
If you're at risk, taking action today can prevent serious financial consequences. Here are your options:
✅ Apply for the Fresh Start Program
The Department of Education created a temporary "Fresh Start" initiative for defaulted borrowers. It allows you to:
Get out of default
Restore access to federal aid
Stop collections
Re-enter a repayment plan
But this program is only temporary, so don’t wait.
✅ Set Up an Affordable Repayment Plan
You may qualify for an Income-Driven Repayment (IDR) plan, which could lower your monthly payment to as little as $0 depending on your income.
✅ Talk to a Debt Specialist
You don’t have to figure this out alone. Our team can walk you through your options, help you apply for the right program, and take steps to protect your finances.
🔹 Why It’s Important to Act Now
Waiting could cost you:
Your paycheck (through wage garnishment)
Your tax refund
Your credit score
Peace of mind
But taking action now could stop all of that—and possibly reduce or pause your payments.
🔹 How We Can Help
At My Debt Navigator, we’ve helped many borrowers just like you:
Exit default status
Cut monthly payments in half (or more)
Stop collections
Regain control of their finances
Our consultations are complimentary and confidential, and there's no pressure to commit. We're just here to help you understand your options and move forward.
🚨 Don’t Wait Until You’re Garnished
If you're in default—or not sure where you stand—now is the time to act. The May 5 changes have already gone into effect, and collections are ramping up. The sooner you act, the more options you’ll have.
We’ll help you understand what’s happening, what’s at risk, and how to move forward—step by step.
