Student-loan borrowers could lose their Social Security checks if they fall behind on their loan payments. Democratic lawmakers want to put an end to that practice.
On Monday, Sens. Bernie Sanders, Elizabeth Warren, and Ed Markey introduced a bill to prevent older student-loan borrowers and borrowers with disabilities from facing Social Security garnishment if they default on their payments.
A fact sheet of the legislation reviewed by Business Insider said that the bill would prohibit the Treasury from seizing Social Security payments, including Social Security Disability Insurance, and protect those borrowers from “unnecessary forced collections.”
Sanders said in a statement that “in the richest country in the history of the world, no senior should have their Social Security payments taken away from them to pay back student debt.”
“This is especially true when seniors throughout the country already cannot afford the skyrocketing price of healthcare, prescription drugs, groceries and housing,” Sanders said. “Congress must pass this legislation.”
The legislation comes as student-loan defaults are at a record high. Over 9 million borrowers were in default as of March, according to the latest Education Department data, which happens when a borrower has missed payments for 270 days.
The New York Federal Reserve’s latest household debt report showed that student-loan delinquencies stood at 10.6% in the second quarter of 2026 — up from 10.3% in the first quarter. Pre-pandemic delinquency rates were around 11%, and researchers said the latest data showed that delinquency is stabilizing. Yet researchers said that number could rise again due to the elimination of the Biden-era SAVE repayment plan, which gave borrowers affordable payments and a shorter timeline to debt relief.
Weeks after announcing it would be resuming involuntary collections on defaulted student loans in May 2025, President Donald Trump’s administration announced it was pausing Social Security garnishment. The move was intended to help the administration implement repayment changes, and it’s unclear if continuing the pause would gain bipartisan support. In January, the Education Department announced it would also pause wage garnishments to allow the department more time to implement Trump’s student-loan repayment changes.
The Treasury Department can withhold up to 15% of a student-loan borrower’s Social Security check, up to 15% of their federal salary, and all of a federal tax refund.
The administration has not specified when the pauses will lift. It’s in the process of transitioning over 7 million borrowers off the SAVE plan, and many of those borrowers have said they’re facing higher bills and are worried about the consequences of defaulting, including losing their wages and federal benefits.
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