Wage Garnishment Laws on Student Loans

By Angus Koolbreeze
Avoid defaulting on your student loan or you will face wage garnishment.

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The federal government gives wide latitude to the Education Department in terms of collecting defaulted student loans. One of the remedies it has is wage garnishment. The law allows the agency to take 15 percent of a debtor's wages during each pay period. According to Nolo.com, there is no statute of limitations on a student loan, unlike other debts. Yet under the law both sides have certain rights and responsibilities.

Borrower's Right to Prior Notice

According to the Federal Student Aid website, the borrower must be given 30 days' notice of an intent by the Department of Education to garnish his wages. The garnishee notice must include information, such as the nature and amount of the debt. Moreover, the Department of Education must give the borrower the opportunity to inspect and copy any records related to the amount owing.

Borrower's Right to Object

The borrower also has the right to object, according to the Federal Student Aid website. However, if the borrower disputes the government's claim, he must support this counterclaim with written records proving that the amount the agency claims is owing is not equal to the amount on the original promissory note, even given the capitalization of the interest that occurred. The borrower has the right to object to garnishment if it would create an undue financial hardship. The government may not take more than 30 times the federal minimum wage in force at the time it garnishes the borrower's wages.

Freedom from Job Repercussions

An employer does not have the right to fire or to discipline the borrower over an administrative wage garnishment. However, it is the employee's responsibility to initiate legal action against an employer who dismisses, disciplines or refuses to hire the employee due to a garnishment action.

Borrower's Responsibilities

If the borrower feels that the government is unfairly garnishing his wages, he must request a hearing to discuss the matter on or before the postmarked date on the garnishment notice. According to the Federal Student Aid website, merely requesting documents without submitting a motion for a trial will not delay garnishment proceedings. In addition, the borrower shoulders the responsibility of any legal expenses he may incur in the process of taking the case to trial. In addition, if the borrower reaches an agreement with the lender to pay a certain amount to keep the garnishment at bay, he must pay that amount every month in a timely manner. Any missed payment may result in the lender resuming garnishment proceedings.

About the Author

Angus Koolbreeze has been a freelance writer since 2007. He has been published in a variety of venues, including "He Reigns Magazine" and online publications. Koolbreeze has a Master of Arts in English from Western Michigan University.

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