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

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.