The Trump administration just announced it will resume wage garnishment for defaulted student loan borrowers starting in January 2026, ending years of Biden-era leniency and putting up to 15% of workers’ paychecks at risk.
Story Highlights
- Trump administration will begin garnishing wages from defaulted student loan borrowers in January 2026
- Initial notices target 1,000 borrowers starting January 7, with monthly scaling to affect millions
- Up to 15% of disposable income can be seized without court order after 30-day notice period
- Policy reverses Biden administration’s forgiveness attempts and extended payment pauses since 2020
Trump Restores Fiscal Accountability After Biden’s Failed Policies
The Department of Education announced December 23, 2025, that wage garnishment will resume for federal student loan borrowers who are 270 days past due. This decisive action marks a sharp departure from the Biden administration’s reckless spending and endless loan forgiveness schemes that ultimately failed in court. The Trump administration already ended pandemic-era collection pauses in May 2025, restarting tax refund withholding and other federal payment offsets.
Approximately 8 million borrowers remain in default, a crisis exacerbated by Biden’s misguided policies that encouraged fiscal irresponsibility while burdening taxpayers. The new enforcement targets borrowers who have avoided their obligations since March 2020, when collections were paused under the CARES Act. Unlike the previous administration’s fantasy of blanket forgiveness, Trump’s approach prioritizes recovering taxpayer funds and restoring personal accountability.
Immediate Impact on Defaulted Borrowers
Starting the week of January 7, 2026, approximately 1,000 borrowers will receive initial notices, with the program scaling monthly thereafter. Under federal law, the Department of Education can withhold up to 15% of disposable income without requiring court approval, a powerful tool that was suspended during the pandemic chaos. Borrowers will receive a mandatory 30-day notice period before garnishment begins, providing opportunity to arrange alternative repayment.
The Student Borrower Protection Center predictably criticized the policy, with deputy executive director Persis Yu calling it “cruel” and “unnecessary.” This typical leftist response ignores the fundamental principle that borrowed money must be repaid. These advocacy groups spent years enabling financial irresponsibility while hardworking Americans who paid their debts watched in frustration as deadbeats received preferential treatment under Biden’s disastrous policies.
Ending the Era of Loan Forgiveness Fantasies
The Biden administration’s attempts at broad loan forgiveness, including plans for $10,000-$20,000 per borrower, were rightfully blocked by courts as executive overreach. These unconstitutional schemes would have transferred billions in debt from irresponsible borrowers to responsible taxpayers, violating basic principles of fairness and fiscal sanity. Trump’s restoration of collections represents a return to constitutional governance and fiscal responsibility.
Before 2020, routine wage garnishments collected billions annually from defaulted borrowers, funds that belong to American taxpayers who funded these loans. Biden’s extended pauses and forgiveness fantasies only encouraged more defaults and created a moral hazard that undermined the entire federal lending system. This policy correction sends a clear message that the era of government-subsidized irresponsibility has ended under Trump’s leadership.
Sources:
Student loan borrowers in default may see wages garnished in 2026
