Parents and the Loan Crisis: Avoid Wage Garnishment
Parent loans, often amounting to hundreds of thousands of dollars, were taken out during times of rapidly rising college costs. Now, these substantial debts are reaching a critical point where federal collection actions will commence:
Wage garnishment proceedings beginning in June
Social Security and pension benefits at risk of reduction
Potential seizure of tax refunds and other federal payments
Particularly devastating impact on retirees with fixed incomes
A Lifeline Through Consolidation
While the situation is serious, parents still have options:
Loan consolidation is available even for defaulted loans
Through consolidation, parents may qualify for income-based repayment options
Acting now can prevent the start of garnishment proceedings
Even parents who don't qualify for traditional income-driven repayment plans have alternatives
Parents should:
Contact the provided assistance number to discuss consolidation options
Gather necessary financial documentation to begin the consolidation process
Understand that proactive engagement with loan servicers can halt collection activities
Consider family support, with students potentially helping parents navigate these challenges
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