Trump Postpones Effort to Garnish Student Borrowers’ Wages as Part of Affordability Initiative

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Bloomberg – The U.S. Department of Education has temporarily halted the process of collecting student loan payments directly from borrowers’ wages. This move comes as the Trump administration intensifies its focus on affordability initiatives in the lead-up to the midterm elections.

According to the department, this "temporary pause" will remain in place until new repayment and rehabilitation programs, recently established by legislation, are put into effect. Under Secretary of Education Nicholas Kent explained in a statement that wage garnishment will be more effective and equitable once these new options are operational.

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During a press event in Rhode Island on Monday, Education Secretary Linda McMahon confirmed the suspension, stating the program had been put on hold "for a bit" in response to concerns about Americans facing increasing financial difficulties.

Last month, the Education Department announced plans to restart wage garnishment for student loan defaulters after more than five years, with the first notifications set to go out to 1,000 borrowers. The administration had intended to expand these notifications to additional borrowers each month throughout the year, according to previous Bloomberg reports.

Political Strategy and Policy Shifts

This policy reversal coincides with President Donald Trump’s introduction of several measures designed to address economic challenges and highlight affordability as a central theme for Republicans ahead of the November midterms. In 2026, Trump has advocated for a 10% cap on credit card interest rates, restrictions on corporate home purchases, and proposals requiring tech companies to cover rising energy costs from expanding data centers.

Only those who have not made a student loan payment in over a year—classified as being in default—are currently at risk of wage garnishment.

Government statistics show that 5 million borrowers are in default. However, this figure could rise, as another 6 million are delinquent, according to the American Enterprise Institute. Changes to student loan relief programs, such as ending certain income-driven repayment options for new borrowers, may further increase default rates.

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