BECKLEY, WV (WOAY)- Back in 2020, due to COVID, the Department of Education had stopped collecting payments on student loans. Now, on May 5th, 2025, borrowers can face mandatory collections.
During a press briefing on Monday, the announcement was made that those who have defaulted on their loans prior to COVID will face these collections. However, what does being in default even mean? Well, it means that you haven’t paid any amount to your student loans in 270 days, A.K.A. nine consecutive months.
Out of the roughly 42.7 million americans who have student loan debt, about 5 million of them are in default. Being in default on your loans can affect you in more ways than one.
“That can affect their ability to take a mortgage, a car loan or a credit card. They can have their federal income tax refund withheld. They can also have their wages garnished from the student loan,” explained Carly Kestner, the Director of Financial Aid at Concord University.
Millions of Americans are unsure of the status of their loans as income-driven plans, like Biden’s Save Program, are currently under a court injunction. A graduating student at WVU Tech recently received an email about her loans, so the loans feel more real now.
“I knew taking out these loans that I would eventually have to pay them back, now that it’s time to pay them back, I’m just like, looking at how much I’m going to have to pay, it’s kind of scary. But I’m thankful that nursing will allow me to do so,” said Kylei, a WVU Tech nursing student graduating in May.
If you are unsure of your status, Kestner recommends visiting studentaid.gov. You can see who your loan servicer is and be able to contact them about your status.
This is a developing story, and we’ll continue tracking it.
