Student Loans: What Happens When You Fall Behind?

Millions of Americans are in trouble with their student loans. The government has started collecting again after a long pause. This means people who are behind on their payments might face serious problems. Many folks owe a lot of money. Over 5 million are in default, which means they haven't paid in over a year. Another 4 million are close to defaulting. This is a big issue, and it's getting worse. The government can take money directly from your paycheck if you don't pay your loans. This is called wage garnishment. They don't need a court order. They just send you a notice. If you don't respond, they can take up to 15% of your pay. They can also take your tax refunds and even some Social Security benefits. Older adults are struggling more than younger people. They make up 20% of borrowers but 33% of those who are behind. This is a big problem because it affects their retirement savings. It's also a problem because student loans are different from other debts. There's no time limit on collecting them. The government can keep coming after you forever. The government sent out notices to people who are behind. But these notices don't tell you how to stop wage garnishment. They don't mention that you can appeal if it causes financial hardship. This is a big problem because people need to know their rights. They need to know that they can fight back. There are ways to get out of default. You can rehabilitate your loan by making nine on-time payments. You can consolidate your loans into a new one. You can even pay off the loan in full. But you need to know your options. You need to know that you can fight back against wage garnishment. The government should do more to help people. They should make it easier to understand the notices. They should tell people about their rights. They should make it easier to get out of default. This is a big problem, and it needs big solutions.