Student loan defaults can spur wage garnishment

Many young Mississippians have taken advantage of the state's colleges, universities and technical schools to further their education. Students generally attend with the hope of obtaining a well-paying job afterwards, although the uncertain economy has dimmed that hope for some. Faced with staggering student loan balances and insufficient income to repay those balances, many students have defaulted on their loans.

Unfortunately, when one defaults on a student loan, that person faces the possibility of seeing their wages garnished down the road. While garnishments may not occur right away, their threat should be enough to spur borrowers into taking decisive, informed action. It's important to know that defaulted loans are usually no longer with the original lender. When a borrower experiences a certain number of missed payments, the loan will typically go into collection, usually handled by a third party.

If wages have already been garnished, the collector is usually content to simply keep receiving timely payments, whether they come from the garnishment order or the borrower's voluntary payment. This means that it can be tough to stop garnishment unless the borrower negotiates with the collector and agrees to pay more than the current garnishment order requires.

It is not just employed graduates who are at risk of garnishment. If a borrower who defaults is not employed at the time of default, their future wages could become garnished once they find a job. No graduate should have to enter adulthood with a legal issue weighing down their chances of future success. The financial challenges faced by today's young adults can be formidable, but seeking professional legal advice is one way to understand the situation and determine how to move forward.

Source: The Bradenton Herald, "Debt adviser: How to deal with student loan debt default," Steve Bucci, Mar. 17, 2014

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