More than 10 million student-loan borrowers are behind on payments — with their wages and Social Security on the line
New Federal Student Aid data shows that 9.3 million student-loan borrowers are in default, representing $234 billion in debt, with another 1.5 million at risk of late-stage delinquency. Borrowers face severe consequences including wage garnishment and seizure of tax refunds or Social Security benefits. While wage garnishments are temporarily paused under the Department of Education, upcoming policy changes under President Trump and the elimination of the SAVE plan have heightened borrower anxiety.
Why it matters
Mass student loan default and looming federal enforcement actions threaten the financial stability of millions of Americans, prompting intense legislative and regulatory debate.
New Federal Student Aid data showed that 9.3 million student-loan borrowers are in default. Kevin Carter/Getty Images New Federal Student Aid data found that 9.3 million student-loan borrowers are in default. An additional 1.5 million borrowers are at risk of defaulting in the next six months. Borrowers who default may face a hit to their credit score and the seizure of wages and federal benefits. The number of student-loan borrowers falling behind on payments continues to grow. New Federal Student Aid data through June 30 showed that over the past quarter, 9.3 million borrowers were in default on their loans, which typically happens after 270 days of nonpayment. That's an increase of 400,000 borrowers since the prior quarter. This brings the total amount of federal student loan debt in default to $234 billion, or about 14% of the overall portfolio.
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