Facebook Pixel How to Stop Student Loan Wage Garnishment

How to Stop Student Loan Wage Garnishment

Written by Mark Kantrowitz | Updated March 4, 2022

The U.S. Department of Education can garnish up to 15% of the disposable pay of borrowers who have defaulted on their federal student loans, without requiring a court order. The wage garnishment continues until the debt is repaid. Wage garnishment makes it more difficult for you to pay your bills. But, there are several ways you can stop wage garnishment. 

These are the most common methods of stopping administrative wage garnishment. Note that the garnishment rules for federal student loans are different than the rules for other types of debt.

  • Lender didn’t follow proper procedure. If the lender who holds the loan did not follow proper procedure, the wage garnishment order can be terminated. This includes a failure to provide you with 30 days’ notice of the garnishment or sending the wage garnishment notice to the wrong address. (Borrowers are required to keep their address up-to-date with the lender. If you did not do this, delays in receipt of the wage garnishment notice are your fault.)
  • Not your loans. Ask for a hearing when you receive the wage garnishment order and ask for proof that the debt is your debt. If you can prove that you’re a victim of identity theft and did not borrow or benefit from the loans, the wage garnishment will not go into effect. 
  • Negotiate repayment terms. Borrowers can negotiate repayment terms with the collection agency or the U.S. Department of Education. If the borrower sends the first payment under this agreement to the U.S. Department of Education within 30 days of the date the garnishment notice was sent, the administrative wage garnishment order will not go into effect. 
  • You got fired. If you were involuntarily terminated from your previous job, wage garnishment will be suspended for the first 12 months of your new job. 
  • Work a minimum-wage job. Federal rules limit administrative wage garnishment for defaulted federal student loans to 15% of the borrower’s disposable pay. In addition, the borrower must be left with at least 30 times the federal minimum wage. If you are working a minimum-wage job, the wage garnishment amount may be significantly reduced or even eliminated. Waiters and waitresses often earn less than the minimum wage. 
  • Become self-employed. If you are self-employed, you aren’t an employee and don’t have wages that can be garnished. Examples include freelancers, general contractors, handyman, plumbers, commissioned real estate agents and truck drivers. However, as an independent contractor your income may still be subject to wage garnishment if you operate your own business and your business pays you wages. But, you might be able to limit your wages to the federal minimum wage to avoid wage garnishment. 
  • File for bankruptcy. Even though it is almost impossible to discharge student loans in bankruptcy, administrative wage garnishment will be suspended for the duration of the bankruptcy case. 
  • Discharge your debt. Wage garnishment ends after the student loan debt is discharged. This includes the total and permanent disability discharge, unpaid refund discharge, closed school discharge and false certification discharge. 
  • Appeal based on financial hardship. Borrowers can ask for a review based on financial hardship. If approved, this will typically suspend administrative wage garnishment for 12 months.
  • Rehabilitate the debt. If the borrower rehabilitates the debt by making 9 out of 10 consecutive, full, voluntary, reasonable and affordable monthly loan payments as part of a loan rehabilitation agreement, the loans will no longer be in default and the wage garnishment will end. Borrowers can also rehabilitate the loans by consolidating them and agreeing to repay the consolidation loan through an income-driven repayment plan. The monthly loan payments under income-driven repayment are usually less than the wage garnishment amount. 
  • Pay off the loans in full. You could use your savings to pay off the debt or ask friends and family to pay off the debt. Sometimes, the borrower’s parents will use their savings or a home equity loan to pay off the student loans.
  • Refinance your debt. If you refinance your federal student loans into a private student loan, the new loans pay off your old loans, ending the wage garnishment. But, it will be difficult for a borrower who has defaulted on their federal student loans to qualify for a refinance. Plus, refinancing federal loans means a loss in benefits, including income-driven repayment plans, potential for loan forgiveness, and options for deferment.
  • Seek a settlement. Borrowers may be able to settle their defaulted federal student loans for less than what they owe. The three standard settlement offers include waiving the collection charges, waiving half of the interest that has accrued since the loan went into default and reducing the loan balance by 10%. As soon as the borrower pays the amount agreed to in the signed settlement offer, the wage garnishment will end.

If you are serving on active duty in the U.S. Armed Forces, tell the judge. The Servicemembers Civil Relief Act (SCRA) provides protections against certain proceedings for servicemembers. In particular, the judge or hearing officer must appoint a lawyer to represent the servicemember and must grant a delay of at least 90 days in certain circumstances. 

Sign up to get the latest student loan tips and news:

* indicates required



The ChangEd app helps student loan borrowers pay down their debt faster. Link your credit and debit cards and with every purchase you make, the total is rounded up, and that “spare change” is added to your student loans. You can also earn points for potential free payments. Read our review to learn more.

Considering a deferment? Use our Cost of Deferment Calculator to evaluates the impact of interest capitalization at the end of a deferment or forbearance on the monthly loan payment and the cost of the loan, assuming that the loan payments are re-amortized after the deferment or forbearance.

Follow us on FacebookTwitter, and LinkedIn for expert advice and the latest news!

At Savingforcollege.com, our goal is to help you make smart decisions about saving and paying for education. Some of the products featured in this article are from our partners, but this doesn’t influence our evaluations. Our opinions are our own.

Was this article helpful?

About the author

Mark Kantrowitz is a nationally-recognized expert on student financial aid, scholarships and student loans. His mission is to deliver practical information, advice and tools to students and their families so they can make informed decisions about planning and paying for college. Mark writes extensively about student financial aid policy. He has testified before Congress and federal/state agencies about student aid on several occasions. Mark has been quoted in more than 10,000 newspaper and magazine articles. He has written for the New York Times, Wall Street Journal, Washington Post, Reuters, Huffington Post, U.S. News & World Report, Money Magazine, Bottom Line/Personal, Forbes, Newsweek and Time Magazine. He was named a Money Hero by Money Magazine. He is the author of five bestselling books about scholarships and financial aid, including How to Appeal for More College Financial Aid, Twisdoms about Paying for College, Filing the FAFSA and Secrets to Winning a Scholarship. Mark serves on the editorial board of the Journal of Student Financial Aid and the editorial advisory board of Bottom Line/Personal (a Boardroom, Inc. publication). He is also a member of the board of trustees of the Center for Excellence in Education. Mark previously served as a member of the board of directors of the National Scholarship Providers Association. Mark is currently Publisher of PrivateStudentLoans.guru, a web site that provides students with smart borrowing tips about private student loans. Mark has served previously as publisher of the Cappex.com, Edvisors, Fastweb and FinAid web sites. He has previously been employed at Just Research, the MIT Artificial Intelligence Laboratory, Bitstream Inc. and the Planning Research Corporation. Mark is President of Cerebly, Inc. (formerly MK Consulting, Inc.), a consulting firm focused on computer science, artificial intelligence, and statistical and policy analysis. Mark is ABD on a PhD in computer science from Carnegie Mellon University (CMU). He has Bachelor of Science degrees in mathematics and philosophy from MIT and a Master of Science degree in computer science from CMU. He is also an alumnus of the Research Science Institute program established by Admiral H. G. Rickover.

Full bio →

A good place to start:

See the best 529 plans, personalized for you

Helping families save for college since 1999
Join our email list

The latest articles and tips to help parents stay on track with saving and paying for college, delivered to your inbox every week.

Frequently featured in:

Saving For College is an unbiased, independent resource for parents and financial professionals, providing them with information and tools to understand the benefits of 529 college savings plans and how to meet the challenge of increasing college costs.

20533 Biscayne Blvd Ste 4 #199 Miami, FL 33180-1501Phone: (585) 286-5426Copyright © 2025 Saving for College, LLC. All Rights Reserved