Imagine checking your bank account and seeing your hard-earned paycheck shrink—automatically—because of unpaid student loans. Wage garnishment is one of the most stressful consequences of falling behind on student loan repayment, but knowing your rights and options can help you avoid this worst-case scenario.
In this guide, Kaplan Law Firm explains:
- How wage garnishment works for federal student loans
- Common triggers and timelines
- Steps you can take to stop garnishment
- When to call a lawyer for student loans
What Is Wage Garnishment—and Why Does It Happen?
Wage garnishment is a legal process where your employer is ordered to withhold a portion of your paycheck to satisfy a creditor—in this case, the U.S. Department of Education or a private loan holder. For federal student loans, garnishment can begin only after:
- Default: You haven’t made a payment in 270 days (9 months).
- Notice & Demand: You receive a “Notice of Intent to Garnish” at least 30 days before garnishment starts.
- Failure to Respond: You don’t dispute the debt or arrange a repayment solution within those 30 days.
Once garnishment begins, up to 15% of your disposable income (the amount left after legally required deductions) can be withheld.
How Garnishment Impacts Your Finances
- Reduced Take-Home Pay: Less money for rent, groceries, and bills.
- Stress & Anxiety: Constant worry about making ends meet.
- Credit Score Damage: Default and garnishment show up on your credit report.
- Limited Options: Garnishment continues until the loan is repaid in full or you come to an agreement.
If you’re already behind on payments, wage garnishment can feel like a trap. But it’s not hopeless—and you have rights.
Steps to Stop or Prevent Wage Garnishment
1. Enter an Income-Driven Repayment (IDR) Plan
If you haven’t already, apply for an IDR plan—such as PAYE, REPAYE, or IBR—to lower your monthly payment based on your income and family size. Once you’re enrolled and recertify annually, garnishment stops immediately.
2. Request a Rehabilitation Agreement
For borrowers in default, loan rehabilitation lets you make 9 voluntary, reasonable payments over 10 months. After successful rehabilitation, your loans are removed from default status, garnishment ends, and you may regain eligibility for student loan forgiveness programs, like Public Service Loan Forgiveness (PSLF).
3. Consolidate Your Loans
Direct consolidation can cure default status if you make three consecutive, on-time payments. This also moves you into a new loan agreement, stopping garnishment and giving you access to IDR plans.
4. Submit a “Financial Hardship” Claim
If garnishment would cause undue financial hardship, you can request a withholding rate lower than 15%. You’ll need to document your income and expenses to support your claim.
5. Dispute the Debt
If you believe the loan balance or terms are wrong, you can dispute the debt in writing within the 30-day “Notice of Intent” window. While a dispute is pending, garnishment must be paused.
Private vs. Federal Loan Garnishment
- Federal Loans: Garnishment is handled by the U.S. Department of Education and regulated by federal law—meaning there are clear procedures and borrower protections.
- Private Loans: Policies vary by lender and state law. Some private lenders may sue you in civil court, get a judgment, and then garnish your wages. Others place liens on bank accounts or offset tax refunds.
If you have both federal and private student loans, garnishment from private creditors can overlap with federal withholding—making total deductions even more severe.
When to Call Kaplan Law Firm
Stopping garnishment often involves paperwork, negotiations, and understanding complex regulations. If you’re overwhelmed—or if you’ve tried IDR, rehabilitation, and consolidation without success—it’s time to get legal help. Kaplan Law Firm can:
- Review your loan history and servicer actions to identify errors
- Negotiate with servicers to set up or adjust repayment plans
- Represent you in disputes or administrative hearings
- Advise you on whether bankruptcy could be an option (in rare cases)
We’ve helped clients secure over $23 million in student loan forgiveness and protected countless paychecks from garnishment.
Take Control of Your Financial Future
Wage garnishment doesn’t have to be permanent. By acting early—enrolling in an IDR plan, rehabilitating or consolidating your loans, or getting professional legal advice—you can stop garnishment and get back on track toward student loan forgiveness and financial stability.
If you’ve received a Notice of Intent to Garnish or if garnishment has already begun, don’t wait. Contact Kaplan Law Firm today for a free consultation and take the first step to protect your paycheck.
Schedule your consultation today.
