Student Loan Creditors Can Garnish Your Money
Summary
The article explores whether student loans can garnish a person's bank account. It explains that while private lenders typically need to sue borrowers and obtain a court judgment to garnish funds, the situation is different for federal student loans. The U.S. Department of Education has the power to garnish wages and seize tax refunds without a court order. Moreover, they can also access a borrower's bank account under certain circumstances, known as administrative garnishment. This process allows the government to collect overdue federal student loan payments directly from a debtor's account, making it important for borrowers to stay current on their loan payments.
Investopedia
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