Wage Garnishments & Your Defaulted Student Loans

bills laid outThere are several serious consequences that can occur when you default on your federal student loan. One tool commonly used by the Department of Education (or a guaranty agency) to collect past due amounts is an administrative wage garnishment, which allows the government to garnish your paycheck without obtaining a court order first!

The maximum amount that can be garnished by the government is 15% of your “disposable income.” Disposable income is the amount remaining after the deductions that are required under the law are withheld. Additionally, you must be left an amount that is equal to thirty times the minimum wage.

The government must give you written notification of the proposed garnishment and an opportunity to challenge the administrative wage garnishment. You typically must request a hearing within 30 days of receipt of the notice. If you fail to request a hearing within 30 days, the garnishment may proceed, but it can be halted if you are successful at your hearing.

If you are interested in challenging a wage garnishment by the government, our student loan attorneys can help. Below are just a few examples of defenses that we can assist you with:

  • Financial hardship to you and your dependents
  • The loan has been repaid
  • You were terminated from your last job and have been employed in your current job for less than 12 months
  • Your school failed to pay you an owed refund
  • You do not owe the amount being claimed
  • The loan is not yours or the loan documents were forged
  • You have filed bankruptcy (or the loan was discharged in bankruptcy)
  • You are paying under a repayment agreement
  • You are permanently disabled
  • You qualify for a closed school or other type of student loan discharge

The above list is not exhaustive. Let us review your individual circumstances and determine what defenses are available to you to challenge an administrative wage garnishment.

Please keep in mind that every matter is different. If you have questions about your student loan debt and you would like to schedule a no-cost consultation to discuss your options, please contact our office by completing the form on this website or calling us at (954) 280-5066.

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