How To Stop Student Loan Wage Garnishment

While most people love happy surprises, it’s no fun to get a notice in the mail from the U.S. Department of Education stating that your wages are being garnished due to non-payment of your student loans.

Not only can this put additional pressure on your personal finances, it can be extremely embarrassing and possibly cost you your job. That’s because the situation is now between you, the disgruntled lender and your employer who is now required by law to implement a wage garnishment for student loans.

While you should never stop making payments on your federal student debt, extenuating financial circumstances may arise and it is important you learn how to stop the student loan wage garnishment and get your debt payments back on track.

Wage Garnishment for Student Loans

How Your Student Loans Could Cost More Than Your Education

For millions of former students each and every year, student loan debt is a ball and chain that can cast a shadow for many years – for some, even till retirement. And unfortunately, unless or until this debt has been paid back, there can be some fairly hefty consequences if the balance goes into default.

Some of the many ways in which the non-payment of student loans can affect you include:

Credit Report and Score

Just as with any other loan that is overdue, if you default on your student loan, it can be turned over to a collection agency – and this, in turn, can show up on your credit report. It can also lower your credit score. The blemish can remain for as long as seven years, resulting in difficulty getting a car loan, a mortgage, or even renting an apartment.


Defaulting on your student loans can also have an impact on your employment situation. For example, individuals who don’t pay back these types of loans are not allowed to work for a federal agency. This can also ring true for most state, city, and county government jobs.

In addition, the situation could even prevent you from joining the military – and, if a job position requires you to obtain a security clearance, having a defaulted student loan may even prevent you from getting that, too.


Your student loan default may also make it more difficult to obtain various plans such as utilities, cell phone service, cable television, and Internet.

Student Loans

It probably should go without saying that if you default on your student loans, you won’t be able to obtain other student loans in order to complete or continue your education in the future.

How To Stop Wage Garnishment For Student Loans

If your wages are being garnished because of your student loan debt, there are some things that you can do in order to help in alleviating the situation.

Connect With Your Loan Servicer

The first step in this situation should be to immediately discuss any possible options with your student loan servicer.

Doing so can oftentimes help you come to an agreement with them in terms of getting your student loan back on track. Because lenders don’t like seeing borrowers default on loans, they are often very receptive to discussing various repayment possibilities.

Another possible option for you would be to contact the U.S. Department’s Debt Collection Service Center. The number for this organization should be listed on the letter for your wage garnishment.

Consolidate Your Student Loans

One of the best ways to get out of student loan default is to obtain a direct consolidation loan. Doing so can take multiple loans and roll them into just one single loan with one monthly payment – which may be lower than the cumulative sum that you are currently paying now. Prior to going this route, however, be sure that you will be able to easily make this payment and that it, too, will not get or keep you in financial hardship.

In any case, it will be important for you to develop a plan for making on-time loan payments going forward. Designing a personal or household budget can be a good start for getting – and keeping – yourself on track for success in this area.

Challenging the Garnishment

In some situations, it may be possible to challenge and stop the garnishment of your wages. Because the Department of Education or guaranty agency is required to notify you prior to making the actual garnishment, this means that you must also be provided with the opportunity to have a hearing to challenge it.

During this hearing, you may challenge one or all of the following:

  • The amount of the student debt
  • The terms of the repayment schedule
  • The existence of the debt altogether

Should you request a hearing within 30 days of receiving your notice, the wage garnishment may not be able to move forward – unless you are unable to prove your case.

Other common challenges against having your wages garnished may include:

  • The loan is not yours
  • The garnishment would cause financial hardship to you (and your dependents)
  • You have filed for bankruptcy
  • The educational institution failed to pay you a refund that it owed to you
  • You have already entered into another repayment agreement

How To Avoid Student Loan Wage Garnishment

While challenging a student loan garnishment of wages may be a way to temporarily stall the situation, it is not always possible to completely avoid paying what you owe. For example, even if you have lost your job or you are having other financial hardship, you may or may not always be able to get around your making your student loan payments.

In some cases, for example, debt collectors may end up freezing the money in your bank account(s). It is also possible that the creditor may even go after the income of your spouse. And, years down the road, it is possible that your Social Security retirement benefits could even be affected.

What To Do Next…

If you are having trouble with paying your student loans, the best course of action is typically to keep an open line of communication with your loan servicer. That way, you can all work together in determining a plan that can work best for everyone that’s involved.

The worst thing you can do is just the opposite – avoid communication and try to ignore the issue. Unfortunately, when it comes to wage garnishment for student loans, this is an issue that isn’t likely to go away quietly.