Student Loan Clear

Default and collections / Guides

Last verified Oct 17, 2026 against the official sources listed below

Student loan default: what it means and what happens

When a loan is in default

A Direct Loan is in default when a payment has been missed for 270 days and it is reasonable to conclude you no longer intend to repay (34 CFR 685.102). StudentAid.gov adds that if you haven’t made a full payment in at least a year and aren’t in a deferment or forbearance, your loans are likely in default; your StudentAid.gov dashboard shows a red warning.

What happens next

  • The loan moves to the Department’s Default Resolution Group (DRG); defaulted FFEL loans go to a guaranty agency.
  • If nothing is done within 65 days, DRG reports the default to the four major credit bureaus.
  • After more than 360 days without payment, involuntary collection can begin: wage garnishment of up to 15% of disposable pay and Treasury offset of tax refunds and some federal benefits.
  • Collection costs can be added to what you owe.

Where collections stand

On Jan. 16, 2026 the Department announced it would delay wage garnishment and Treasury offset while it puts the new repayment rules in place, giving borrowers time to use the new plans and a second chance at rehabilitation. As of the date at the top of this page we have not found an official restart date.

Official channels

DRG doesn’t charge for its services. The official site for defaulted loans is MyEdDebt.ed.gov; DRG’s phone number is 1-800-621-3115. StudentAid.gov warns that companies charging “enrollment” or “maintenance” fees to get you out of default may be scams.

How much could be taken: the garnishment calculator. How to get out: getting out of default.

What to do next

  1. Check your status on StudentAid.gov and MyEdDebt.ed.gov.
  2. Call the Default Resolution Group at 1-800-621-3115; it’s free.
  3. Look at rehabilitation and consolidation before collections restart.

See what garnishment could take

Not financial or legal advice. This page explains the published rules. It does not tell you which plan to choose. Your loan servicer and StudentAid.gov have the final word on your account.

Official sources

  1. 34 CFR 685.102, definitions including default (current eCFR)
  2. StudentAid.gov: Student Loan Default and Collections: FAQs
  3. U.S. Department of Education press release, Jan. 16, 2026: involuntary collections delayed
  4. 20 U.S.C. 1095a, wage garnishment (Cornell LII)
  5. 31 CFR 285.4, offset of federal benefit payments (current eCFR)

Last verified Oct 17, 2026. Corrections are logged on What changed.

Next guide: Getting out of student loan default: rehabilitation vs consolidation