Trump Resumes Student Loan Collections, Wallets Everywhere Beg for Mercy
KEY POINTS
- •Nearly 9 million borrowers are in default after not paying student loans for over 270 days, reports say.
- •Trump's Education Department resumed collections in May 2025, reversing a five-year pause on wage garnishments and tax seizures.
- •The Department of Education blames Biden's pandemic relief for masking delinquency spikes but warns borrowers to prepare for tougher repayment plans.
In a move equally surprising as a cat refusing a nap, May 2025 saw Trump’s Education Department pull the 'pause' plug on student loan garnishments, ending a five-year snooze that had left 9 million borrowers, or one in five, officially in default after 270 days of ghosting payments. Meanwhile, credit scores took a nosedive averaging 57 points in early 2025, as one-quarter of borrowers played catch-up with delinquencies, courtesy of Biden's soft-soap relief known as the 'on-ramp.' Press secretary Ellen Keast claims this spike is just Trump’s version of being brutally honest — restoring full damage reports on debt instead of pandemic-era hush money. Not helping? Trump’s so-called 'big beautiful' legislation kerfuffled income-driven repayment plans, effectively turning the student loan forgiveness cupcake into a triple-layer brick of extended payments. The SAVE plan that let fragile borrowers pay zilch is now toast, and those defaulting face an endgame where tax refunds and Social Security cash become collateral damage if the garnishment freeze melts away. Institutions are being lectured to get their act together by Education Undersecretary Nicholas Kent, who reminded schools: you can’t keep taking taxpayer money while graduating people who think 'repayment' is a Netflix series.
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Trump ended the five-year garnishment siesta, turning 9 million defaulted borrowers into walking wallets prepped for tax and Social Security plundering. It’s less loan repayment, more national workout in financial suffering.
In 2025, skipping student loan payments long enough to qualify for 'default' status is trending big thanks to Trump’s collection reboot—apparently, desperation is still hot.
Biden’s ‘on-ramp’ to repayments was like a soft reset, but Trump slammed it into full ‘report-no-shame’ mode, revealing if you ignore student debt long enough, your credit screams like a horror movie.
Source: Businessinsider | Published: 2/24/2026 | Author: Ayelet Sheffey
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