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What does the pause on Social Security garnishment mean for borrowers?
The pause on Social Security garnishment means that the government will not deduct funds from Social Security benefits to repay defaulted student loans. This decision provides temporary relief for borrowers who rely on these benefits for their living expenses.
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How many borrowers are affected by this decision?
The pause affects over 5 million borrowers, including approximately 452,000 individuals aged 62 and older who are in default on their student loans. This significant number highlights the widespread impact of the decision.
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What are advocates saying about the need for more relief?
Advocates argue that simply pausing the garnishment is not enough. They emphasize the need for comprehensive relief measures to address the financial burdens faced by borrowers, particularly older individuals who have seen a dramatic increase in student loan debt.
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What are the implications for older borrowers in financial distress?
Older borrowers, particularly those on fixed incomes, may find temporary relief from the garnishment pause. However, with total student loan debt among older individuals reaching $125 billion, advocates stress that more needs to be done to alleviate their financial struggles.
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What led to the pause in Social Security garnishment?
The pause follows the resumption of collections on defaulted student loans after a five-year hiatus due to the pandemic. The Department of Education's decision reflects a commitment to protect vulnerable populations, including Social Security recipients.
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What should borrowers do during this pause?
Borrowers should take this opportunity to assess their financial situation and explore options for repayment or forgiveness programs. It's also advisable to stay informed about any changes in policies that may affect their loans in the future.