If you’re carrying federal student loan debt or supporting a family member who is, there’s important news you need to hear. As of January 2025, the Department of Education has resumed collection activities on federal student loans after years of pandemic-related forbearance.
For many Massachusetts families, this shift has created confusion and anxiety. Let’s break down what’s happening, what options exist, and how to protect yourself from serious financial consequences.
The End of Forbearance: What Changed in January
During the pandemic, the government placed federal student loans into forbearance, essentially hitting pause on collection activities. That safety net has now been removed, and collection efforts have restarted for loans in default.
But here’s where it gets tricky: not everyone’s situation is the same. Some loans were already in default before the forbearance began. Others may have fallen behind after deferment periods ended. And many borrowers simply aren’t sure where they stand or what their payment obligations are.
The first step is finding out exactly where you are with your loans.
Start With StudentAid.gov
Before panic sets in, visit studentaid.gov. This government website allows you to look up your specific federal student loans, check their status, and view available repayment options. You’ll need your loan number or login credentials to access your account.
The site can feel overwhelming at first glance, but it’s the most reliable source for information about your federal loans. You’ll find details about income-based repayment programs and other options that might apply to your specific loan type.
Different federal student loans come with different eligibility requirements for various repayment programs, so understanding what you’re dealing with is the foundation for any strategy moving forward.
Federal Loans Come With Unique Collection Powers
Here’s something that catches many Massachusetts residents off guard: federal student loans operate differently than other debts when it comes to collection.
With most debts—credit cards, medical bills, even private student loans—a creditor must sue you, obtain a judgment, and then file additional legal paperwork before they can garnish your wages. It’s a multi-step process that takes time.
Federal student loans don’t follow that path. The government can initiate administrative garnishment without going to court first. This means money could start coming out of your paycheck without a lawsuit or judgment.
This isn’t said to create fear, but to emphasize why federal student loans deserve serious attention in your overall debt strategy. The consequences for ignoring them can arrive faster than with other obligations.
Creating a Debt Repayment Strategy
When you’re juggling multiple financial obligations—car payments, credit cards, rent or mortgage, and student loans—it helps to take a step back and assess everything at once.
Write it all down. List every debt, the amount owed, and the interest rate. This gives you a clear picture of your total financial landscape.
There are different schools of thought on which debts to tackle first. Some financial professionals recommend targeting high-interest debt first, since that’s where you lose the most money over time. Others advocate for the “snowball method”—paying off smaller debts first to build momentum and free up cash flow.
Both approaches have merit. What matters most is choosing a method you’ll stick with.
When prioritizing, remember that certain expenses can’t be negotiated. You need housing, transportation to get to work, and food on the table. But student loans shouldn’t be ignored either—especially given their unique collection powers.
Can Bankruptcy Help With Student Loan Debt?
Many people assume bankruptcy will wipe out student loans along with credit cards and medical bills. Unfortunately, it’s not that straightforward.
When filing bankruptcy, you must list all debts, including student loans. However, student loans—whether federal or private—typically aren’t dischargeable in bankruptcy. They survive the process.
There is one potential exception: the “undue hardship” standard. Through a legal proceeding called an adversary proceeding within a bankruptcy case, you can ask the court to discharge your student loans by proving that repaying them would create an undue hardship.
The challenge? Bankruptcy courts throughout the country have set this bar extremely high. What you or I might consider an undue hardship often doesn’t meet the legal threshold courts have established.
That said, bankruptcy can still help indirectly. If you’re drowning in credit card debt, medical bills, and other unsecured obligations, eliminating those through bankruptcy might free up enough income to make your student loan payments manageable. Sometimes removing the surrounding financial pressure makes the student loans workable.
Don’t Wait Until Collections Start
The worst thing you can do with student loan debt is nothing. Even if you haven’t received collection notices yet, if you know you’re not making payments on a federal student loan, it’s time to take action.
Proactive outreach almost always yields better results than waiting for the government to come to you. Once collection activities begin, your options may become more limited, and the process more stressful.
Getting Professional Guidance
Everyone’s financial situation is different. The repayment strategy that works for one family might not fit another’s circumstances. Sometimes what seems like a straightforward situation involves complications that aren’t immediately obvious.
If you’re feeling overwhelmed by student loan debt, especially combined with other financial obligations, talking with someone who focuses on debt relief can provide clarity. A free consultation can help you review your complete financial picture and identify options you might not have considered.
For Massachusetts residents facing these challenges, the law office of Eric Kornblum offers free consultations to assess your situation and discuss available options. You can reach them at their website: https://debtfreema.com/
Moving Forward
Federal student loan collections resuming after years of forbearance represents a significant shift for many families. But with the right information and strategy, it’s a challenge you can manage.
Start by checking your loan status on studentaid.gov. Take inventory of all your debts. Consider your priorities and what repayment strategy makes sense for your situation. And don’t hesitate to get professional guidance if you need it.
The key is taking action rather than hoping the problem will resolve itself. Your financial future is too important to leave to chance.
MA bankruptcy lawyer Eric Kornblum graduated from State University of New York, Binghamton in 1989 and received his law degree in 1992 at Western New England College, School of Law. Since opening his own practice, Eric has been dedicated to helping his clients resolve their financial problems both in and out of court.