Student Loan Related

Is There Any Hope to Stop My Student Loan Wage Garnishment and Tax Refund Intercept?

Written by Steve Rhode


Dear Steve,

I was just wondering if you could give me some advice on a 25-year-old student loan for $7,000 which got me in trouble.

Any advice you can give me my question is if there is any help out there for me I am paying interest on interest for 25-year-old $7,000 student loan my paycheck has been garnished for the last 4 years and my federal income tax has been taken for the last 4 years my loan was $26400 and is still at 11500



Dear Lillian,

It appears you have an old federal student loan you are dealing with. The clue is the tax refund intercept which is only available to federal student loans and not private student loans.

I would bet over the last 25 years there have been times when you have not made payments for one reason or another. Skipping payments or being in default only increases your balance owed because of added interest or penalties.

You mention your paycheck is being garnished as well. It’s probably an Administrative Wage Garnishment.

I previously wrote this article you should read that shows you how to stop the wage garnishment and tax refund intercepts.

The good news is you can stop the punishment you are experiencing, bring your loans current, and get on a repayment plan you can afford.

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About the author

Steve Rhode

Steve Rhode is the Get Out of Debt Guy and has been helping good people with bad debt problems since 1994. You can learn more about Steve, here.

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