Bills Logo

How to Stop Garnishment on Student Loans

How to Stop Garnishment on Student Loans
Daniel Cohen
UpdatedMar 12, 2014
  • clock icon
    5 min read
Key Takeaways:
  • Contact the Dept. of Education to prevent wage garnishment.
  • Consider filing a Chapter 13, which results in a court supervised repayment plan.

State and Federal Laws May Help You Stop a Student Loan Wage Garnishment.

The options available to stop or reduce a student loan-related wage garnishment depend on what kind of loan and where you live. The rules are different for federal student loans, such as Perkins, Stafford, and PLUS loans, and for private student loans.

Federal Student Loan Garnishment

Federal law allows the Department of Education to garnish 15% of a delinquent borrower’s after tax income for federally insured student loans (34 C.F.R. Part 34-Administrative Wage Garnishment). It may do so as long as the garnishment does not bring the borrower’s weekly pay below 30 times the Federal minimum wage. Currently, you are guaranteed that $217.50 ($7.25/hour × 30 hours) per week is exempt from garnishment. (These numbers are current as of early 2014.)

If you make less than that amount each week, then your wages are exempt from garnishment altogether. Unlike other creditors, the federal government has the right to garnish wages, levy bank accounts, and seize property without first obtaining a court judgment against the debtor (31 USC Chapter 37, Subchapter II). Federal agencies may intercept your tax refund, which is called "offset" (26 U.S.C. § 6402(d) and 31 U.S.C. § 3720A). You also can have your income tax refund taken to pay down your student loan debt.

Keep in mind that no matter where you live, if your loans are federally insured, you can usually be garnished 15% of your disposable wages, regardless of your state laws regarding garnishment for other types of debts.

If you can prove to the Dept. of Education that its garnishment of your wages is causing your family an undue financial hardship, it may be willing to stop the garnishment and work with you in establishing alternate repayment terms. For example, facing foreclosure of your home as a result of garnishment should qualify as an undue hardship.

To try to stop an administrative garnishment, contact the Department of Education’s resource Facing Loan Default. The DOE provides a list of resources available for consumers who have defaulted on their loans. Another good resource to explore is the Student Loan Borrower Assistance Project’s (SLBAP) Administrative Wage Garnishments.

If your federal student loan payments are causing financial distress, review the Income-Based Repayment (IBR) program, and see the Dept. of Education’s IBR calculator. If you do not qualify for IBR, learn if Income Contingent Repayment is right for you.

If you defaulted on your federal loans and want to restart payments, see the Dept. of Education’s Loan Rehabilitation page.

Statute of Limitations and Loan Type

Check the Dept. of Education’s National Student Loan Data System (NSLDS) to see if the loan is federal. State statutes of limitations do not apply to federal loans, and are subject to collection indefinitely. Student loans not backed by federal grants or guarantees do not appear in the NSLDS, and are therefore private. Private student loans are subject to state statutes of limitations for breach of contract.

Private Student Loan Garnishment

Private student loans, on the other hand, are basically the same as any other unsecured personal loan; the only major difference between private student loans and regular personal loans is that the former are generally non-dischargeable in bankruptcy.

Learn more about Student Loan Consolidation

Need a student loan? See the resource Student Loans resource page. Problem with a student loan? Learn more about Student Loan Consolidation.

Private lenders must file a lawsuit against the borrower and obtain a judgment before they can garnish wages, so it takes private lenders longer to begin a garnishment. A judgment will appear in the "Public Records" area of your credit report.

Quick Tip

Concerned about what is appearing on your credit report now? Check your credit report today and get a free credit score instantly.

Depending on where you live, private lenders with a judgment may garnish as much as 25% of the your after-tax wages (15 U.S.C. 1673). However, the amount that can be garnished is specific to each state. See the resource Collection Laws & Exemptions by State to determine how much of your pay can be garnished by private lenders. Texas and Pennsylvania, for example, do not allow wage garnishment for unsecured debts such as private student loans.

To try to stop a garnishment resulting from a private loan, you should contact the creditor to discuss your financial situation and try to negotiate an alternate payment plan. Unfortunately, the creditor may not be willing to stop the garnishment voluntarily, forcing you to explore alternative options.

Quick Tip

Some debt settlement companies are now accepting private student loan debt. Get a free consultation with a pre-screened debt relief provider, if you are struggling to pay your private student loans.

Bankruptcy and Student loans

The last option most people consider to prevent garnishment for student loans is filing for bankruptcy protection. since student loans generally cannot be discharged in a chapter 7 filing, you would probably need to file a chapter 13 bankruptcy, which is a court supervised repayment plan in which your student loans, as well as other debts, would be repaid through monthly payments made to the court.

Chapter 13 can be an expensive and long-term commitment (5 years, typically), but if you feel it may be an option to stop your wage garnishment, consult with a bankruptcy attorney in your area to learn if bankruptcy will help improve your financial outlook. Surprisingly, some find their monthly payments under a chapter 13 are more than the amount they would have been garnished had they done nothing, so if you are considering bankruptcy, please make sure to discuss it in detail with an attorney to determine if it is the right choice for you.

Filing a chapter 13 bankruptcy may bring your mortgage current, stop a foreclosure, and allow you to pay now-delinquent payments over the course of your bankruptcy plan. To learn more about your bankruptcy options, visit the bankruptcy information & resources page.


DDaniel J Rouege, Jan, 2020

Where do I start with stopping wage garnishment in Texas? I tried to reach out to the company, but they would not give me info? Can i file a fraud case? What would my employer need to stop the garnishment?

DDaniel Cohen, Jan, 2020

You don't make it clear why you suspect fraud.

I recommend that you speak with a bankruptcy attorney ASAP.

AAnonymous, Oct, 2019

I have been being garnished for 2 separate student loans. One started in Feb 2018 and the other Dec 2018. The DOE is garnishing me for a total of 25% of my wages since there are 2 loans. This is approximately $366 every 2 weeks and over $700 every month. I have 3rd party custody of my ex-fiancé 2 children 15 and 13. We also have a child together that is 2 still in diapers. I have custody of all 3 children. I receive no support from dad or the older children's mother either. I recently had to move to an apartment with higher rent and the lease required renter's insurance. My paid off car finally broke down on me after a good 12 year run and I purchased a new vehicle that is reliable for my children and I. Now having a car payment with higher insurance again, higher rent, renter's insurance, trying to keep all utilities on, feed, cloth, and get garnished being a single income home where I only bring home $700-$820 every 2 weeks and that's if I'm lucky to be able to pick up extra hours. Now, I filed for a hearing and because I filed prior to my previous landlord selling my old rental and my old car breaking down, oh and for the simple fact that apparently for a house hold of 4 in my "region" I am only allotted to spend $647/mo for household/food expenses, they say I should have $1,300 left per month to pay bills. Huh??? I need help!!!!!! They denied my hearing. I resubmitted updated info due to new car purchase and new apartment lease etc.

DDaniel Cohen, Oct, 2019

I don't know where the $647 expense figure comes from for a family of 4's monthly allowable expenses for food, clothing, and household items. I assume that the figures that should be used would be consistent with those used for allowable IRS expenses and US Bankruptcy Court expenses. If you click on these links you can see a family of four is allowed more than that for food alone, $958, and when household items and clothing are added, the figure is $1,786/month. There are only national standards for this category. Regional expenses are used for operating a vehicle, and housing allowances vary by county.

I agree that you are not being treated fairly and recommend you press for further explanation, given the discrepancies in the number they are telling you for allowable household food, clothing, and miscellaneous items and what the national standards allow.

If you want to discuss this further, please take our Financial Health Survey and then call 800-998-7497 or email

tthea, Jun, 2014
They are currently garnishing 15% of my income for a defaulted federal student debt. The 950 a month completely killing me. I have submitted all the required documents to the Collection Agency and they said that they would be sending all of those over to the Department of Education. They said that if after 60 day of when I initially filed the request for hearing, if they still do not have a hearing date or a final judgment, they will hold the garnishment. The 60 day time period will be here in about a week. The woman that I worked with through the collection agency asked me to follow up with her a week after she submitted the package, but I haven't heard anything. So my question, in people's experiences, how successful were they in getting a wage garnishment reduction. With them garnishing my paycheck, I can barely buy groceries and put gas into my car in order to get to work. I am a single mom of two kids and one of my kids are in college. When I sent them my final financials I basically I have an extra $150 after all of my bills have been paid and this was before the garnishment. I just want to know what the chances are for them reducing my garnishment and by how much.
FFaith, Apr, 2014
My employer incorrectly garnished my wages at 25% instead of 15%. Can I get that money back. It stated in the paperwork in 3 places not to exceed 15%.
BBill, Apr, 2014
Have a heart-to-heart conversation with your payroll person. If he or she refuses to correct the error, then you have two choices: Live with the error, or hire a lawyer to send your payroll person a letter explaining the law.
SSean McRoberts, May, 2014
With a loan consolidation, you could have your wage garnishment removed completely. There are services available that will allow you to create a repayment plan that is based on your current income. If you have not already consolidated your student loans, then this would be a good option for you.