The Trump administration has restarted collections on all student loans that are in default, ending the pandemic-era pause that began in 2020

The federal Department of Education is once again referring student loan borrowers in default to debt collectors. Why it matters: After a five-year penalty pause, the 5.3 million borrowers in default could see their wages and tax refunds garnished if they don't resume payments.

A record-high percentage of student loan borrowers are delinquent, and the federal government is resuming collections on accounts in defaults. These developments are coming at a time when steep tariffs threaten to increase already high costs of living.