Deb Sorensen – Page 2

Student loans in default to be referred to debt collection, Education Department says

May 19, 2025

AP News

For borrowers in default, one step to avoid wage garnishment is to get into loan rehabilitation, said Betsy Mayotte, president of The Institute for Student Loan Advisors.

Borrowers must ask their loan servicer to be placed into such a program. Typically, servicers ask for proof of income and expenses to calculate a payment amount. Once a borrower has paid on time for nine months in a row, they are taken out of default, Mayotte said. A loan rehabilitation can only be done once.

What to know as the government begins collections on defaulted student debt

May 19, 2025

Betsy Mayotte, president of the Institute of Student Loan Advisors (TISLA), says the return of loan collection was inevitable and that the Trump administration isn’t creating new policy — just restoring old policy.

“They were always going to start collecting these defaulted loans again — it was just a matter of when the switch was going to get flipped,” she says. “The Department of Education has a requirement to collect on these debts; they’re owed to the U.S. taxpayer.”

Can the Department of Education garnish your wages to repay your student loan?

May 19, 2025

“Anybody who’s affected by this they were almost certainly in default pre-COVID. If you’re not sure if you’re in default or not, you can go to Studentaid.gov, which is the Department of Ed’s website, and once you log in, you’ll know there’ll be like a red flag, ‘danger Will Robinson’ and your loan will show in a status of default,” said Betsy Mayotte, President, The Institute of Student Loan Advisors.

If You’re Behind on Student Loan Payments, Your Wages Could Be Garnished Soon

May 19, 2025

CNET

“It’s only defaulted loans that are at risk of wage garnishment, tax refund offset, Social Security garnishment and collection costs,” Betsy Mayotte, president of the nonprofit Institute of Student Loan Advisors, said in an email to CNET.

Personal Finance What student loan borrowers should know as Trump targets Public Service Loan Forgiveness

May 19, 2025

“Borrowers that work for those organizations are concerned,” said Betsy Mayotte, president of The Institute of Student Loan Advisors, a nonprofit.Borrowers in the PSLF program won’t see an immediate effect. Trump’s order requested an update to the regulations regarding the program, she said: “That process can take a year or more.”

“I also suspect that this will be challenged in court,” Mayotte said. “The bottom line is that 501(c)(3)s are eligible for PSLF under the law. An EO can’t change.”

Changes also can’t be retroactive, she said. That means that if you are currently working for or previously worked for an organization that the Trump administration later excludes from the program, you’ll still get credit for that time, at least up until the changes go into effect.