Student loan borrowers face significant changes as collection practices resume and the Department of Education faces potential dismantling by December 2026. Deborah Paul from the Louisiana Office of Student Financial Assistance explains what borrowers need to know about these changes and how to navigate them effectively.

• Student loans are considered in default after 270 days without payment
• Only 38% of student loans are currently being paid as agreed
• Default consequences include wage garnishment (up to 15%), tax refund seizure, and credit damage
• Collection activities resume May 5th with at least 30 days notice before garnishment begins
• Borrowers can rehabilitate defaulted loans with 9 consecutive monthly payments
• Income-driven repayment plans calculate payments based on what borrowers can afford
• Deferment options exist for those returning to school, serving in military, or facing economic hardship
• Forbearance provides temporary relief for short-term financial difficulties
• The Department of Education dismantling would transfer functions to Treasury, HHS, and Justice departments
• Check your loan status at studentaid.gov by accessing the National Student Loan Data System
• Dual enrollment programs allow high school students to earn college credits, potentially graduating with associate degrees
• Future changes may include eliminating PLUS loans, increasing Pell Grant requirements, and decreasing loan limits

Contact Federal Student Aid at studentaid.gov to check your loan status and explore your options. Default can severely impact your financial future, so take action now before collection activities intensify.

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