Student Loan Default Warning: Wage Garnishment Resumes May 5 – Here’s What You Can Do
Major Student Loan Update: Default Collections Resume
As of May 5, 2025, the federal government will resume collections on defaulted student loans, impacting 5.3 million borrowers—over 10% of all student loan holders.
What does that mean? If you're in default, the government can:
- Garnish your tax refund
- Withhold Social Security benefits
- Garnish your wages (if you’re a W-2 employee)
👉 If you’re already in default or even just 61–90 days late, you could be on the path to losing part of your paycheck. But don’t panic—you have options.
Are You Actually in Default? (You Might Not Be)
Some borrowers are wrongly flagged as defaulting due to servicer errors—like missing enrollment in income-driven repayment (IDR) plans or misapplied payments.
✅ Tip: Check your status by logging in to your account through your servicer website
Your Two Options: Loan Rehabilitation vs. Consolidation
Let’s break it down:
What’s Better?
If you haven’t used the Fresh Start program, rehabilitation might be your golden ticket. It not only clears default but wipes the record off your credit report.
But here’s the catch: Servicers don’t always make this easy. You’ll need to fill out forms, document your income and expenses, and sometimes mail or fax paperwork (yes, fax!).
“I Tried to Do the Right Thing—Now I’m in Default?”
If you:
- Submitted IDR paperwork, but the servicer didn’t process it
- Missed the checkbox to request a $5 placeholder payment
- Got no follow-up or confirmation
You could be flagged as 270+ days late—even if it’s not your fault.
In this case, you can submit written documentation (don’t call—get a paper trail!) explaining your situation and request to be enrolled in a $5/month plan.
How LoanSense Helps
We’re here to take the stress off your shoulders. Our services:
- Calculate your accurate monthly payment
- Help choose the best path: rehab or consolidation
- Fill out and submit all your paperwork (no faxes for you!)
- Provide credit correction documentation if you were wrongly flagged
Keep a paper trail so you can dispute any errors in the future
Some borrowers have qualified for monthly payments as low as $5 through rehabilitation.
👉 Need help right now? email us at hello@myloansense.com
🎁 Use our discount code: LS20OFF
📌 Book a call with an advisor: [Booking Link]
Why This Matters Beyond Loans
Default status can wreck your credit, impacting your ability to:
- Rent an apartment
- Get a car loan
- Buy a home (especially painful if you're mid-mortgage process)
Don’t let an error or delay ruin your financial future.
Take These 3 Steps Today
1.Check your status on StudentAid.gov
2.Pull your credit report at AnnualCreditReport.com
3.Contact LoanSense to help you figure out the best plan forward.
Book a call with an advisor: [Booking Link]
“You're not just a number. Your fear is valid. We're here to help remove the confusion and support you with real solutions—so you can move forward without the burden of student loan stress.”