Here’s How You Can Challenge Wage Garnishment for Defaulted Student Loans

“I like debt for me,” said then-2016 presidential candidate Donald Trump. While defending himself against attacks by Hillary Clinton, Trump referred to himself as the “king of debt,” touting his classic business skills in renegotiating debts for his financial gain. Trump flipped the script on how many think about debt, which has long been held as a deep moral obligation to be paid in every account. Rather, Trump told the truth about debt: that the debtor-creditor relationship, much like the worker-boss relationship, implies financial power on both ends. Today, however, Trump finds himself not as the debtor, but as the creditor, set to use the broad powers of the federal government to push the masses even further into poverty.

For the first time since the onset of COVID-19, the Trump administration is set to garnish U.S. workers’ wages for defaulted student loans. The Department of Education has announced that beginning this week it will send at least 1,000 borrowers a notice of intent to garnish wages, sending additional notices every month as it expands its efforts to forcibly collect money from millions of borrowers in default.

This is a cruel, harsh policy that the Trump administration does not have to implement — and it shouldn’t.

Most Americans with student loan debt cannot afford to keep up with their payments, which average over $400 a month. With stagnant wages, record-high household debt burdens, the rising cost of college, and ballooning interest, the student debt crisis has only worsened since its inception. Student debt is often difficult to discharge in bankruptcy. Unlike mortgages and every other type of debt, student loan interest can capitalize — forcing debtors to pay interest on the interest on the principal. The Saving on a Valuable Education (SAVE) plan, the most affordable repayment plan ever introduced in the U.S., has been effectively undermined by the Trump administration, causing expected payments to skyrocket. And of course, cancellation plans that grant debtors relief after 10 or 20 years have been bungled or thwarted.

Nearly a third of debtors have reported going without food, medicine, or other necessities to keep up with student loan payments.

Student debt garnishments can take up to 15 percent of a workers’ paycheck, enough to push people who need every penny they earn off the edge. Nearly a third of debtors have reported going without food, medicine, or other necessities to keep up with student loan payments, and more than 9 in 10 debtors who have experienced wage garnishment say it caused them financial hardship.

Like much of the story with student loans, garnishment isn’t cleanly administered. Employers often incorrectly take much more of a worker’s paycheck than what is legally allowed or continue to garnish wages after a loan has been paid in full, leaving borrowers with zero dollars in their bank account and stealing their time by forcing them to navigate a byzantine system to correct these errors. According to public legal filings, nearly 400,000 debtors received refunds totaling more than $185 million for wages illegally garnished in 2021 — refunds that, while borrowers waited for them, caused workers to lose their homes and suffer other financial hardships.

As an organizer with the Debt Collective, the nation’s first union of debtors, I know the toll that garnishment can take. For many, it results in harm to their stomachs as they skip meals, harm to their teeth as they avoid the dentist, and harm to their mental health, their kids, their dreams, and even their own lives. One of our members, Jessica Madison, died after the federal government repeatedly illegally garnished money from her account, rendering her unable to see a doctor for her cancer.

Jessica Madison died after the federal government repeatedly illegally garnished money from her account, rendering her unable to see a doctor for her cancer.

It’s not just that student debtors fall behind on their payments. The borrowers in default are those who struggle the most in our economy. Nearly 1 million borrowers have loans that have been in continuous default for 20 years or more. Many of the borrowers in default attended a predatory for-profit college that preyed on their desire to get an education before defrauding them. Older borrowers, the fastest-growing population of student debtors who often are on fixed incomes, experience default at higher-than-average rates. Forty percent of student debtors have debt with no degree, often having been unable to complete their college education due to the high price or life-changing circumstances. In other words, garnishing wages for those unable to pay is like trying to draw water from stones.

It’s not too late for the Trump administration to reverse course on what would be an economically devastating policy for U.S. families and our economy. In June 2025, the Trump administration was set to continue a shameful policy that the Biden administration was set to implement as well: garnish older adults’ Social Security checks for defaulted student loans. Instead, the administration decided to (temporarily) reverse course, noting that Social Security provides the last few dollars that many older Americans have.

But debtors shouldn’t feel hopeless. The truth is, there are a host of options at debtors’ disposal that the Department of Education does not tell borrowers about. Many borrowers who receive default notices will actually be eligible for debt cancellation, whether they know it or not.

Cancellation programs like Total and Permanent Disability, False Certification, and Borrower Defense can provide relief for millions of borrowers who deserve it because their university cheated them or closed down while they were enrolled. Another little-known option that borrowers have is to apply for a hardship exemption if wage garnishment causes them financial hardship. While temporary, and certainly not a solution to the student debt crisis, debtors can apply to pause or reduce forced collections if they are in difficult circumstances.

Forty percent of student debtors have debt with no degree, often having been unable to complete their college education due to the high price or life-changing circumstances.

There is also a solid chance that debtors are in default because of an error caused by their student loan servicer. Servicers, the middle-men of the student debt system, have gross financial incentives to steer borrowers into the wrong payment plan. As borrower balances get transferred from one servicer to another, and as payments and documents and interest accumulates, errors occur. Many borrowers are told the wrong balance, estimated for the wrong payment and told that years of payments don’t exist. Though rarely granted by the Department of Education, debtors in forbearance of deferment who went into default due to a loan servicer error can challenge the default status and have it reversed.

Some borrowers — such as those who are incarcerated or facing unique circumstances — could also appeal to the Department of Education and request a “compromise” or “write-off” of student loans to prevent administrative wage garnishment.

It’s not just borrowers who should be making noise about the affront that is wage garnishment for student loans. Labor unions should be fighting tooth and nail to ensure that employers protect their workers from illegal forced collections. The more extraction from student debtors, the more there is a drag on our economy — making it harder for businesses to thrive, homes to be purchased, or families to be started.

Student debtors would be wise to fight back at every opportunity, urging the federal government to negotiate student debt on different terms. The Department of Education isn’t just our creditor expecting payments, it is also a democratically elected body that is susceptible to political power from below. To accept the terms and conditions of harsh debt collection is to succumb to a broken system run by unqualified billionaires. To fight back against our debts, as Trump put it, is “a smart thing, not a stupid thing.”