MILWAUKEE — New debt collection tactics targeting student loan borrowers in default were set to begin in June, but a last-minute decision by the Department of Education is now protecting older Americans who were facing seizure of their Social Security benefits to pay back overdue loans.
Ellen Keast, a Department of Education spokeswoman, provided this statement to TMJ4 News: “The Department has not offset any Social Security benefits since restarting collections on May 5 and has put a pause on any future Social Security offsets.
The Trump administration is committed to protecting Social Security recipients who oftentimes rely on a fixed income. In the coming weeks, the Department will begin proactive outreach to recipients about affordable loan repayment options and help them back into good standing.”
The pause comes after the Trump administration announced in April it would resume collection efforts on defaulted student loans, ending the pause put in place in 2020 during the COVID-19 pandemic.
At least 5 million borrowers have not made a payment in over 360 days, according to the Department of Education. The consequences for default are steep – tax refunds and federal benefits may be withheld, and wages could even be garnished.
For borrowers like Cam Hardin, who is working to complete a dual master’s-doctoral program, student loan debt is a serious concern.
“I always make the joke, they’re going to raise me from the grave to make me pay my student loans,” Hardin said.
“It is so high, um — it’s scary,” Hardin said.
Hardin took advantage of the roughly three-year pause on payments at the start of the COVID-19 pandemic. But when that ended, she got a billing statement that brought her to tears.
When asked about her monthly payment, Hardin revealed it was $1,100.
“I dissolved into tears, would be a way to say that, because I was very concerned,” Hardin said.
“I make pretty good money, but that is beyond me,” Hardin said.
That's why Hardin turned to Rae Kaplan, a nationwide student loan lawyer.
“There’s a lot of confusion out there about student loans, there’s a lot of fear,” Kaplan said.
Using Zoom meetings, Kaplan’s firm helps borrowers consolidate debt, make a payment plan or even get their loans forgiven completely.
Watch: Milwaukee woman's student loan story offers hope to borrowers with crushing debt
“They think that there is nothing they can do, but the reality is that there is a tremendous amount of relief available to them by law — they just don’t know how to access it,” Kaplan said.
“We have a good track record. We’ve gotten $23 million in loans, at least, eliminated,” Kaplan said.
Kaplan helped Hardin realize that Public Service Loan Forgiveness is something she may be eligible for.
“I’ve made payments on that plan for years. I’m not employed right now in an eligible position, but I’m going to find one in the fall,” Hardin said.
If you cannot afford your payment, you have options. According to Hardin, “If you can’t afford your payment, it likely is because you’re getting a statement showing a standard repayment plan, which is one of the highest monthly payment plans available.”
You can change your payment plan by visiting studentaid.gov to get started. There is a loan simulator tool that helps estimate monthly payments using different repayment options, or you can explore temporarily suspending payments.
If your federal student loans are in default, you need to visit myeddebt.ed.gov. The site will walk you through the two main ways to get out: rehabilitating your loans or consolidating.
"I can truly work on my student loans with payments I can afford, and that is everything to me," Hardin said.
With a plan to pay off her debt, Hardin now feels empowered.
"It made things hopeful again," Hardin said.
The Department of Education says it will resume collection tactics sometime this summer.
This story was reported on-air by a journalist and has been converted to this platform with the assistance of AI. Our editorial team verifies all reporting on all platforms for fairness and accuracy.
It’s about time to watch on your time. Stream local news and weather 24/7 by searching for “TMJ4” on your device.
Available for download on Roku, Apple TV, Amazon Fire TV, and more.
