New Yorkers with defaulted student loans are once again facing involuntary collections after the Trump administration ended the five-year pandemic pause on May 5. The Department of Education said the move was needed to protect taxpayers and restore financial accountability.
Borrowers with loans in default received notices urging them to resume payments, enroll in income-driven plans, or pursue loan rehabilitation. On average, New Yorkers owe $38,690, and nearly half of all borrowers are under 35. Officials also restarted the Treasury Offset Program to seize tax refunds or other payments.
Despite the Biden administration previously forgiving over $180 billion in loans, mass forgiveness has ended. Borrowers can check their status or explore repayment options at studentaid.gov to avoid further financial penalties.
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