The Education Department did not respond to Fortune’s request for comment on when wage garnishment would begin or whether borrowers would be notified ahead of time.
There are nearly 2 million federal student loan borrowers who are at immediate risk of wage garnishment. The Trump administration has only previously disclosed wage garnishment would begin “later this summer,” and Labor Day weekend traditionally marks the end of the season.
An additional 1 million to 2 million could be in default in the coming months, bringing the total of student loan borrowers risking wage garnishment to up to 4 million. Being in default means the borrower has failed to make payments for 270 days, or about nine months, “so you are not at risk for garnishment if you are just a few months behind and not in actual default,” Morgan said.
“Student loan borrowers of any credit risk tier can find themselves falling behind in their payments and at risk for default, even during a time in which we’ve seen most consumers are managing their debt relatively well,” Joshua Turnbull, senior vice president and head of consumer lending at TransUnion, said in a statement.
Borrowers who face wage garnishment are entitled to a 30-day notice before garnishment begins, but many people miss or misunderstand those communications.
By law, the government must leave at least 30 times the federal minimum wage per week, which would be $217.50.
Although potential wage garnishment can feel intimidating and stressful, there are some things you can do to potentially avoid or halt garnishment.
“It’s important that borrowers stay engaged with their servicers and begin making payments,” he said. “Because ignoring loans only increases the risk of falling into collections and wage garnishment.”
Morgan said other options include debt consolidation or rehabilitation—but rehabilitation is only allowed once. This is when borrowers enter an agreement with their student loan servicer, typically after defaulting, that requires the borrower to make nine on-time monthly payments during a 10-month period. Morgan said the minimum payment is $5 per month, but can be based on your finances.
He has also filed bankruptcy for a few clients who have had student loan garnishments, but said it’s not a long-term solution because it rarely dissolves a borrower’s debt in full.
Bankruptcy “basically [gives you] time to regroup.”
If you do end up having your wages garnished, Sleek said it’s important to be proactive.
“Keep records of all correspondence and request a detailed calculation of how the garnishment amount was determined,” he said. “If self-employed, note that wage garnishment by the government generally does not apply.”
