Wage garnishments and collections may be reinstated for federal student loan borrowers in default.

• Those who fail to keep up with their federal student loan payments will face repercussions.
• Here's what borrowers need to know.

Those who fail to pay their federal student loans will face repercussions.

The Biden administration granted borrowers an additional year of protection from the consequences of missed payments after the Covid pandemic-era pause on payments ended in September 2023.

Those who fail to pay their student loan bills may face collection action.

Here's what borrowers need to know.

Borrowers should 'not let it get this far'

Mark Kantrowitz, a higher education expert, advised that borrowers should receive multiple notices from their student loan servicers before falling into delinquency or default.

According to Kantrowitz, typically, it takes between 270 and 360 days for a payment to be reported to credit rating companies, and for the consequences of default to occur.

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If you default on your federal student loans, you may face garnishment of your wages and Social Security benefits, up to 15%, and also lose eligibility for a mortgage from the Federal Housing Administration or the U.S. Department of Veterans Affairs.

"Borrowers should not let it get this far," Kantrowitz said.

Options for student loan borrowers who can't pay

Experts suggest that struggling student loan borrowers can check if they are eligible for a deferment or forbearance.

If you're out of work, you can request an unemployment deferment with your servicer. If you're facing another financial challenge, you may be eligible for an economic hardship deferment. Those who qualify for a hardship deferment include individuals receiving certain types of federal or state aid.

Apart from the commonly known student loan deferments, there are lesser-known options such as the graduate fellowship deferment, military service and post-active duty deferment, and cancer treatment deferment.

Borrowers of student loans who do not qualify for deferment may apply for forbearance.

Borrowers can keep their loans on hold for up to three years, as per the U.S. Department of Education. However, interest accumulates during this time, which may result in a larger bill for borrowers when the forbearance period ends, advocates caution.

Repayment plans that base monthly payments on a percentage of discretionary income can be beneficial for borrowers concerned about long-term affordability. These plans can result in a $0 bill after a specified period.

It's best to explore these options sooner rather than later.

Before a borrower can benefit from an affordable repayment plan, deferment, or forbearance, they must complete a loan rehabilitation process as required by the U.S. Department of Education. This process can take several months to complete.