How to Stop Student Loan Wage Garnishment

If you’ve opened your paycheck and realized part of it is missing for student loans, you are not alone—and you are not stuck. Wage garnishment feels terrifying, especially when you’re already stretched thin, but there are real steps you can take to lower, pause, or eventually stop it.

This guide walks you through what’s happening, the deadlines that actually matter, and the options that can help you protect your income over time.

Quick note: This article is for general information only and is not legal or financial advice. Student loan rules can change, so always confirm details with your loan servicer or at StudentAid.gov.

2026 Update

Right now, the rules for student loan garnishment is changing to help more people get back on track easier. However, that is creating a confusing situation for people who are trying to figure out their current student loan situation.

The most important thing to know right now is that the U.S. Department of Education has officially delayed “involuntary collections”. This announcement was made on January 16, 2026 and affects both the Administrative Wage Garnishment (AWG) and Treasury Offset Program (TOP).

They have decided to delay collections so that servicers have time to adjust their systems and borrowers have a chance to fix their loans before collections begin again.

Some of the new changes include:

• Second Chance Rehabilitation: Rehabilitation is a program where you make a series of on-time payments to get your loan out of default. Before this new law, you were only allowed to rehabilitate a loan one time. If you messed up again, you were out of luck. Now, the Act gives borrowers a second chance to rehabilitate their loans.
• New IDR Plan Structure: Starting on July 1, 2026, a new IDR plan will be available. The new plan will have many features that will be helpful to low income borrowers, including an unpaid interest waiver that can help if your payments don’t cover your full interested owed. This may help stop your loan balance from growing out of control.

Even though the garnishment process has temporarily stopped, the default status of your loan is still serious. The Department of Education still reports defaults to the credit reporting agencies, and this can make it harder for you to get credit or even rent an apartment.

Need help reviewing your situation? You can call our sponsor, CareConnect USA, at 888-201-0431. They can help you understand potential student loan relief options and next steps.

Please note that everything after this point is applicable to how student loan garnishment was handled in 2025 and earlier.

What to Do if You Get a Garnishment Notice

If you’re staring at a scary letter from the government or a collection agency, here’s what to do first:

1. Open the letter and note the dates. Look for the date on the notice and any deadline listed for responding.
2. Mark your 30‑day deadline. For federal loans, you usually have 30 days from the date on the notice to request a hearing that can keep garnishment from starting.
3. Decide whether to request a hearing. If the amount looks wrong, the debt might not be yours, or the garnishment would make it impossible to cover basics, a hearing may help.
4. Call the number on the notice. This is usually the Department of Education’s Default Resolution Group or a collection agency working for them. Ask about a voluntary repayment agreement or loan rehabilitation.
5. Start a hardship file for yourself. Gather pay stubs, rent or mortgage, utilities, childcare, medical bills, and any other proof that shows how tight things are. This can be useful for your own records, if you need to explain the default.

We’ll break all of this down step by step below.

How Student Loan Garnishment Works

Wage garnishment happens when money is taken out of your paycheck to pay a debt. It can happen for:

• Federal student loans
• Private student loans
• Child support
• Back taxes
• Other court judgments

For federal student loans:

• Your loan usually goes into default after about 270 days (roughly nine months) of missed payments on a typical plan.
• Once you’re in default, the U.S. Department of Education (ED) can use Administrative Wage Garnishment (AWG) to take money from your paycheck without going to court.
• Under current rules, ED can garnish up to 15% of your disposable pay for defaulted federal student loans.
• Federal law also says you must be left with at least 30 times the federal minimum wage per week—right now that’s $217.50 per week at a $7.25/hour minimum wage.

For private student loans, the rules are different and driven by your state. Most private lenders have to sue you and get a court judgment before they can garnish your wages.

This guide will help you figure out which kind of loan you have, what your rights are, and what to do next.

What to Do if You Get Garnished

Before you can fix anything, you need to know what you’re up against.

Find out what kind of loan and garnishment you’re dealing with.

Look for clues on your billing statements, emails, or the notice you received:

• Federal loans often mention “Direct Loan,” “FFEL,” “Perkins,” or the U.S. Department of Education.
• Private loans are usually issued by banks, credit unions, or private lenders and won’t reference the Department of Education.

You can also log in to your account at StudentAid.gov to see all of your federal loans. If a loan is not listed there, it’s likely private.

You also need to figure out what kind of garnishment notice you’re dealing with. Check the letter for language like:

• “Notice of Intent to Garnish” or “Notice of Intent to Initiate Administrative Wage Garnishment” are usually sent for federal loans.
• Court papers such as a summons, complaint, or judgment points to private loans or other debts and usually involves state law.

For federal loans under AWG, you should receive a written notice at least 30 days before garnishment can begin. The notice should explain how much you owe, that they intend to garnish, and your rights to inspect or copy records, request a hearing or enter into a voluntary repayment agreement.

Knowing whether you’re dealing with federal vs private, and administrative vs court‑ordered garnishment, will tell you which rules apply to you in the next steps.

Make an action plan.

Once you’ve confirmed it’s a federal loan and an AWG notice, here’s a simple game plan.

1. Read the notice carefully. Note the date on the letter, the amount they say you owe, the proposed garnishment percentage, and the deadline for responding.
2. Request your records if something feels off. If you’re not sure the debt is yours or the balance looks wrong, ask for copies of your records. The notice should explain how to do this.
3. Decide whether to request a hearing (and do it fast if you will). If you want to challenge the debt or argue hardship, send a written hearing request within 30 days of the date on the notice. Use the address, fax number, or online form listed in the letter.
4. Call the number on the notice. This is usually the Default Resolution Group or a collection contractor for ED. Make sure to ask about:
   • A voluntary repayment agreement that could keep you out of garnishment.
   • Whether you qualify for loan rehabilitation.
   • Any option for a hardship review or lower garnishment percentage.
5. Start a budget and work on your hardship story. Write out your income and basic expenses. Keep receipts and bills. You may need them for a hearing, hardship review, or rehabilitation paperwork.

You don’t have to do all of this in one day—but that 30 day window is real, so don’t wait to act.

Know your rights and deadlines.

For federal student loans, there are two key timelines you need to know:

1. 30‑day advance notice: The Department of Education must send you a written Notice of Intent to Garnish at least 30 days before AWG begins.
2. 30‑day hearing deadline (this one is huge):
   • To stop garnishment from starting, you typically need to request a hearing in writing within 30 days of the date on that notice.
   • If you request a hearing on time, ED generally cannot start garnishment until after a decision is made.
   • If you request a hearing after 30 days, they may still consider it—but garnishment can start while your case is being reviewed.

At a hearing, you can ask them to reduce or stop garnishment if:

• The debt is not yours or the amount is wrong.
• The debt is unenforceable (for example, already discharged or paid).
• Garnishment would cause serious financial hardship for you or your dependents.
• You recently started work after an involuntary layoff (usually within the last 12 months).

Helpful documents for a hardship hearing include:

• Pay stubs
• Rent or mortgage statements
• Utility bills
• Childcare or school costs
• Medical bills
• Any other proof of your basic expenses

If your notice came from the Department of Education or a collection agency working for them, it should explain how to request a hearing and where to send your documents. Follow those instructions exactly and keep copies of everything.

Long-Term Solutions for Defaulted Student Loans

Stopping garnishment isn’t just about getting through this month. You also want a plan that gets you out of default and into a payment plan you can actually afford.

There are three main tools that people tend to recommend, but there is a lot of nuance that tends to get missed in these conversations.

We’re going to discuss:

1. Loan rehabilitation (primary path out of default)
2. Consolidation (helpful at specific times, but not a magic off‑switch if garnishment has already begun)
3. Income‑driven repayment (IDR) (your long‑term, lower‑payment plan once you’re out of default to make sure you don’t end up back in default)

Loan Rehabilitation

Loan rehabilitation is often the best long‑term fix for defaulted federal student loans.

Here’s what it usually looks like:

• You agree to make nine voluntary, reasonable, and affordable monthly payments within 10 months.
• The payment amount is based on your income and expenses, so it can be very low for low‑income borrowers.
• Only voluntary payments count—money taken by garnishment or tax refund offset doesn’t.
• Once you successfully finish rehab, your loan is no longer in default, and your account is transferred back to a regular servicer.
• At that point, wage garnishment should stop, and you can choose a regular repayment plan, including income‑driven options.

A few things to keep in mind:

• Garnishment may continue for a while even after you start rehab. Often, ED keeps taking some money from your paycheck until you’ve made five qualifying rehab payments.
• Rehabilitation is usually a one‑time chance per loan, so you want to make it count. Note that the new 2026 rules are going to give borrowers a second chance at rehabilitation, also.

Loan Consolidation

Consolidation used to be talked about like a quick way to stop garnishment. That’s not how it generally works now.

Here’s the more accurate picture:

• Before garnishment starts:
  • If your loans are in default but AWG hasn’t started yet, you may be able to consolidate into a new Direct Consolidation Loan and choose an income‑driven repayment plan.
  • Done right, this can pull you out of default and help you avoid garnishment.
• After garnishment is already active:
  • Loans that are under an active wage garnishment order usually cannot be consolidated until that order is lifted or the default is resolved another way.
  • In other words, consolidation is not a same‑day off‑switch for existing garnishments.

Because of that, consolidation is often most useful before AWG starts or after you’ve completed rehabilitation or another resolution, not in the middle of an active garnishment.

2026 Update: Because the Department of Education paused involuntary collections on Jan 16, 2026, many borrowers who were previously blocked from consolidating due to active garnishment may now be able to do so. The Department explicitly invites borrowers to use this delay to consolidate their loans.

Income-Driven Repayment Plans

Income‑driven plans are a powerful solution that have worked well for me and many of our readers. These plans have several advantages, because they can:

• Set your monthly payment based on your income and family size.
• Bring payments down to as low as $0 per month for very low‑income households. (New plans may have a $10 minimum)
• Offer a path to eventual forgiveness if you stay on the plan long enough.

But here’s the catch: if your loans are already in default or under AWG, you usually can’t just sign up for IDR right away.

The typical flow looks like this:

Default → Rehab or eligible consolidation → Back to a regular servicer → Enroll in IDR (possibly with a $0 payment).

So when you read about $0 payments under IDR, remember that you often have to fix the default first—that’s where rehab or a well‑timed consolidation comes in.

What to Do If You’re Already Being Garnished…

If the money is already coming out of your paycheck, you still have options—it just may take some time for the changes to show up on your stub.

Here’s what usually happens with an active federal student loan garnishment:

• Up to 15% of your disposable pay can be taken each pay period.
• You must be left with at least 30 times the federal minimum wage per week.

If garnishment has already started, follow these steps:

1. Confirm what the garnishment is for. Check your pay stub and any letters from your employer or the government. Make sure it is actually for federal student loans and not another debt.
2. Contact the Default Resolution Group or collection agency. Use the contact information on your notice or garnishment paperwork. Ask about loan rehabilitation and whether you can request a hardship review.
3. Consider requesting a hearing if your situation has changed. Even after garnishment starts, you may still be able to request a hearing, especially if the amount is wrong, your income has dropped, or you’ve had a major expense or new dependent.
4. Set realistic expectations. Garnishment often keeps going for a while even after you start rehabilitation. The goal is to complete rehab so the loan is taken out of default, the garnishment stops, and you can move into an IDR plan with a more affordable payment.

This is not fast or fun—but you do have a path out.

A Few Things You Need to Know

There are a few other things you need to know.

Where to Get Free or Low Cost Help

You do not have to figure this out by yourself. There are people and organizations whose whole job is to help with this kind of mess.

Here are some places to start:

• Legal aid organizations in your state: Many states have free or low‑cost legal aid offices that help with debt, collections, and student loan problems. We have a list of legal aid resources here.
• Nonprofit credit counseling agencies: Reputable nonprofit counselors can help you build a budget, review your debts, and map out options. Make sure you’re working with a nonprofit agency, not a for‑profit “debt relief” company that charges high fees.
• Federal Student Aid / Default Resolution Group: For federal loans, StudentAid.gov is your home base. You can find contact information for the Default Resolution Group, read about default, rehabilitation, and income‑driven repayment, and see which programs are currently available.

If you feel overwhelmed, your first move can simply be: call one helper—legal aid, a trusted nonprofit counselor, or the Default Resolution Group—and let them walk you through the next step.

Note: Due to the 2026 pause on collections, the Department of Education specifically encourages you to contact the Default Resolution Group now to explore your options without the immediate threat of garnishment.

Relief Recap

You’ve got this — even if it feels overwhelming right now. Student loan rules have been changing a lot, and the most important thing is that you don’t ignore notices and you take one step at a time to protect your paycheck and get out of default.

We’ll keep this guide updated as new repayment changes roll out in 2026 and beyond. If you want more step-by-step help like this, make sure to subscribe to our YouTube channel and follow along — we break down the confusing stuff in plain English so you always know what to do next.