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Trump Plan to Penalize 10 Million Student Loan Defaulters

By Drooid · Oct 19, 2026, 11:27 PM UTC · How we work

Summary

Story summary

U.S. President Donald Trump’s administration will penalize nearly 10 million defaulted student-loan borrowers after the midterms.
The plan hires private debt collectors and authorizes garnishment of wages, tax refunds and federal benefits.
July 1 overhaul replaces SAVE with a Repayment Assistance Plan, raising average annual payments by $2,163.
Treasury warned aggressive collections could hurt low-income borrowers and urged delaying the program until after elections.

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Story summary

U.S. President Donald Trump’s administration will penalize nearly 10 million defaulted student-loan borrowers after the midterms.
The plan hires private debt collectors and authorizes garnishment of wages, tax refunds and federal benefits.
July 1 overhaul replaces SAVE with a Repayment Assistance Plan, raising average annual payments by $2,163.
Treasury warned aggressive collections could hurt low-income borrowers and urged delaying the program until after elections.