Paycheck being garnished? Stop Federal Student Loan Wage Garnishment

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How can I stop wage garnishment for student loans?

Defaulting on student loans can have serious consequences.  One of these troubling consequences is the garnishment of wages in order to repay those delinquent loans. Fortunately, there are options to take to stop this garnishment from happening.  However, all options should be reviewed carefully.

A student loan wage garnishment can be challenged based on income, employment status, the procedures used to start the wage garnishment, and several other reasons.  The earlier a wage garnishment is addressed, the easier it will be to successfully stop the wage garnishment from happening.

Wage garnishment can only occur on defaulted student loans.  Typically, a default occurs after failure to make payments for 270 days, or 9 months.  Based on information confirmed by the employer, the loan servicer can calculate just how much can be taken from each paycheck. Only about 15% of a person’s income can be legally garnished.  A loan servicer is also required to give 30 days notice before a garnishment can begin.  If a wage garnishment occurred on a loan that was not defaulted, more than 15% was taken, or it was done less than 30 days before notice, a hearing can be requested to stop the wage garnishment.  Action must be taken quickly, however, if there is intent to request a hearing.  It must be done within 30 days of the notice of garnishment, or the garnishment itself in order to properly stop the garnishment.  Otherwise, the wage garnishment will continue unless the hearing has been won in favor of the garnishee.

The number one reason to request a hearing is if the garnishment of 15% of earnings will impose a financial hardship.  This financial hardship is determined according to family size, income, and expenses.  Other reasons may include: the loan has already been paid back or forgiven, a job holding of less than a year after termination from previous employment, a repayment agreement has already been set up, a file for bankruptcy, or qualification for forgiveness, cancellation, or discharge of the student loan.

If a hearing has been scheduled, it will take place over the phone.  In-person hearings can only occur in Atlanta, Chicago, or San Francisco, and the courts are not responsible for any travel expenses incurred.

If all else fails, the best option is to begin making voluntary payments towards the loan.  A repayment plan can be set up through the loan service.  Wage garnishment would then end. There are advantages to voluntary payments rather than allowing wage garnishment to continue.  There will be no added collection costs, credit rating could improve, and eligibility for future federal student loans may be reinstated.


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