Department of Education to Resume Student Loan Collections

WASHINGTON, D.C. (WJON News) -- If you have a student loan, you'll need to resume regular payments to pay back the money.

The U.S. Department of Education on Monday announced its Office of Federal Student Aid will resume collections of its defaulted student loan portfolio on Monday, May 5th.

The department has not collected on defaulted loans since March 2020.

It says resuming collections protects taxpayers from shouldering the cost of federal student loans that borrowers willingly undertook to finance their postsecondary education.

The Department of Education says 42.7 million borrowers owe more than $1.6 trillion in student debt.

More than five million borrowers have not made a monthly payment in over 360 days and sit in default. As a result, the could be almost 10 million borrowers in default in a few months.

Only 38 percent of borrowers are in repayment and current on their student loans.

All borrowers in default will receive emails from FSA over the next two weeks to make them aware of these new developments and urge them to contact the Default Resolution Group to make a monthly payment, enroll in an income-driven repayment plan, or sign up for loan rehabilitation.