What happens, how much they can take, the federal floor protection, and every option available to stop it.
financial-lit.com — Educational Guide
Estimate exactly how much is being withheld from your paycheck
Wage Garnishment Calculator →Student loan wage garnishment occurs when the federal government requires your employer to withhold a portion of your paycheck to repay a defaulted federal student loan. The government does not need a court order. Your employer receives an administrative wage garnishment notice and is legally required to comply.
Garnishment continues until the defaulted loan is paid in full, or until the default is resolved through rehabilitation or consolidation. This page applies to federal student loans only. Private lenders must obtain a court judgment before garnishing wages.
If you are unsure whether your loans are federal or private, log in to studentaid.gov using your FSA ID to check your loan types and servicer information.
Federal law places a floor on how much income can be garnished. Because the federal minimum wage is $7.25 per hour, the law protects an equivalent amount of your disposable pay each week.
30 × $7.25 = $217.50 per week protected
If your disposable income is at or below $217.50 per week, nothing can be garnished. For borrowers earning above this threshold, garnishment is limited to the lesser of two amounts — 15% of disposable pay, or the amount by which disposable pay exceeds $217.50 per week.
What counts as disposable pay? Disposable pay is your gross wages minus legally required deductions — federal income tax, state income tax, Social Security (6.2%), and Medicare (1.45%). Voluntary deductions like health insurance premiums and retirement contributions are not subtracted from disposable pay under federal garnishment rules.
Yes. In addition to wage garnishment, the Treasury Offset Program allows the government to intercept federal tax refunds, state tax refunds, and Social Security payments for defaulted federal student loans. These can occur at the same time as wage garnishment.
The tax refund offset has no percentage cap. Unlike wage garnishment which is limited to 15% of disposable pay, a tax refund offset can take your entire federal refund in a single year.
Enter your salary, state, and filing status to see how much can be withheld — and compare to what rehabilitation would cost.
Make nine voluntary, on-time monthly payments over a 10-month period. Payments are based on your income using the IBR formula — often significantly less than the garnishment amount. Garnishment is suspended after your fifth consecutive payment. Rehabilitation is the only option that removes the default from your credit report.
Combine your defaulted loans into a new Direct Consolidation Loan. Stops garnishment immediately once complete — typically within two to four weeks. Does not remove the default from your credit report, but restores your loans to good standing quickly.
If you receive a wage garnishment notice you have 30 days to request a hearing. A hearing request temporarily pauses the garnishment process. A hearing does not permanently stop garnishment — it buys time to arrange a longer-term solution.
Contact the Default Resolution Group as soon as possible. Reach them at 1-800-621-3115 or online at myeddebt.ed.gov.
See what rehabilitation would cost based on your income — and how much you would save compared to continuing garnishment.
Defaulted borrowers often face both garnishment and refund offset simultaneously.
financial-lit.com is an independent educational resource. Not affiliated with the federal government, the Department of Education, or any loan servicer. For educational reference only — not a substitute for professional advice.
Sources: studentaid.gov · studentloanborrowerassistance.org · consumerfinance.gov