Headline Roundup • April 22nd, 2025
Education Department Resumes Mandatory Student Loan Collections For Millions of Borrowers in Default
Summary from the AllSides News Team
Starting May 5, approximately 5 million Americans with defaulted student loan payments will have their loans sent for collections, as announced by the Department of Education.
The Details: “American taxpayers will no longer be forced to serve as collateral for irresponsible student loan policies,” Secretary of Education Linda McMahon said. This marks the first time since student loan payments were paused due to the COVID-19 pandemic that the Education Department will begin collecting the debts of borrowers who defaulted. The Department of Education said around 42.7 million borrowers own more than $1.6 trillion in student loan debt, and 5 million haven't made a payment in over a year. Another 4 million, not yet considered in default, haven't made a payment in 91-180 days.
For Context: Several Federal Student Aid (FSA) employees have been terminated at the Department of Education as part of President Donald Trump's efforts to shutter the agency, which has raised concerns for borrowers and the future of the student loan system.
How The Media Covered It: ABC News (Lean Left bias) cited concerns from former Under Secretary of Education James Kvaal about the potential negative impact on borrowers, adding that the Trump administration's cuts to the department would make it harder for those who have missed payments to get back on track. Breitbart (Right), on the other hand, quoted McMahon and emphasized the Trump administration's effort to cut down debt. The Blaze (Right) said the Trump administration ended Biden's “free ride” for “deadbeat” borrowers.
Revised by the AllSides staff (of humans) after a first draft from our custom AI. Learn more. Support our mission. Suggest an improvement to this summary.
Featured Coverage of this Story
Photo by Win McNamee/ Getty Images
The U.S. Department of Education announced on Monday that it would resume involuntary collections of defaulted federal student loans on May 5. The announcement means that borrowers who have loans in default could see their tax refunds seized or wages garnished. While many borrowers and advocacy organizations will oppose the move, resuming collections is necessary to incentivize loan repayment. The announcement was never a matter of if, but when.
The current student loan mess
The federal government suspended student loan payments in March 2020 in response to the Covid-19 pandemic; this meant...
The Department of Education (DoEd) is gearing up to restart involuntary debt collection for its defaulted federal student loan portfolio after pausing collection during the COVID-19 pandemic, the department announced Monday.
The Office of Federal Student Aid (FSA) will officially resume collections of its defaulted federal student loan portfolio on May 5 — until then, borrowers in default will receive emails from FSA making them aware of the change and offering information and assistance. By summer, FSA will send notices before beginning administrative wage garnishment, according to DoE.
Some 5 million Americans with defaulted student loan payments will have their loans sent for collections on May 5, the Department of Education announced on Monday.
Next month, for the first time since student loan payments were paused due to the onset of the COVID-19 pandemic, the Education Department will collect the debts from borrowers who had defaulted -- which means they hadn’t paid their debts for around nine months or 270 days -- before the pandemic.
The announcement comes as scores of Federal Student Aid (FSA) employees have been...
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