Trump admin to garnish wages of student loan borrowers, including IL residents
Illinois residents who are behind in their student loan payments may start seeing smaller paychecks this year.
That’s because President Donald Trump’s administration has announced it will begin to garnish earnings of student loan borrowers who have defaulted — meaning the borrower has not made payments on their loans in at least 270 days.
Around 1,000 defaulted student loan borrowers will receive notices this week, with the number increasing every month, the U.S. Department of Education told NPR. This is the first time collections on student loans have resumed since 2020.
So, what is wage garnishment? And how many Illinois residents will be impacted? Here’s what to know.
What is wage garnishment?
The government can collect payments on defaulted student loans three different ways: withholding tax refunds, withholding federal payments and withholding money from the borrower’s paycheck — also wage garnishment.
The companies that own the debt can order employers to withhold up to 15% of the borrower’s earnings to collect the debt without taking the borrower to court. Notices must be sent out 30 days prior to the first wage garnishment. Following the notice, borrowers have the right to file for a hearing if they reject the action.
If the borrower believes withholding 15% of their paycheck could lead to financial hardship, if they object to the existence, amount of the enforceability or if the borrower has been employed for less than 12 months, they can file for a hearing. Requests for a hearing should be made within 30 days of receiving the garnishment notice in the mail.
Borrowers should contact their loan carrier to see how they can request a hearing, the Department of Education says. Hearing proceedings can be held in person in Atlanta, Chicago or San Francisco, over the phone or a decision can be made virtually through documents submitted in the case. A decision on the hearing would be made within 60 days.
How much student debt does Illinois have?
With a total of $63.2 billion in student debt, there are 1,623,900 student loan borrowers in Illinois, according to the Education Data Initiative.
The average student loan borrower in Illinois has $39,042 in debt, and more than half of them are younger than 35. Around 22% owe between $20,000 and $40,000, and 2.85% owe more than $200,000.
According to university site CollegeRaptor, DeVry University-Illinois is the Illinois college with the highest rate of students defaulting on their loans two years after graduation. Rush University is the Illinois college with the lowest rate of students defaulting after two years.
The top five colleges in Illinois with the highest default rate are:
- DeVry University-Illinois (Lisle)
- East-West University (Chicago)
- Columbia College (Chicago)
- Northwestern College (Oak Lawn)
- Chicago State University (Chicago)
CORRECTION: This article was updated Jan. 12 to correct a reporting error to the universities with the highest two-year rate of loan default.
Do you have a question about education in the metro-east or Illinois for the News-Democrat? We’d like to hear from you. Fill out our Metro-east Matters form below.
This story was originally published January 10, 2026 at 7:00 AM.
