US EditionWhat to Do if Your Credit Score Is Harmed by the Restart of Federal Student Loan Collections
- In May 2025, the U.S. Department of Education restarted collections on defaulted federal student loans for the first time since March 2020.
- This resumption followed a Supreme Court block of President Biden's relief plan affecting 40 million borrowers and a backlog of over 2 million unprocessed income-driven repayment applications.
- Over 5 million individuals currently have overdue student loans, nearly 10 million face imminent default risk, and seven states—primarily led by Republican legislatures—have delinquency rates exceeding 30%.
- A Federal Reserve report forecasts over 9 million borrowers will see credit score drops, including 2.2 million losing 100+ points, as delinquencies appear on credit reports in early 2025.
- Experts recommend stronger servicer oversight, streamlined repayment, and targeted aid since federal help remains limited amid bipartisan gridlock and faulty servicing practices affect millions.
51 Articles
51 Articles
One Missed Payment, a 100-Point Drop: Strategies to Recover Your Score After Decades of Diligence
Key Points A Reddit user is concerned about his credit score. After decades of responsible borrowing, he accidentally missed a payment, and his score dropped by over 100 points. He may be able to fix the situation if his credit card company is willing to help him out. Did you know some credit cards can actually help you get OUT of debt faster? The secret: using a card with a ‘0% Intro APR‘ period (not all do, but theses ones are top picks fr…
Ohio Capital Journal
As feds resume student loan collections, states try to catch borrowers before they sink
Confetti drops on graduates as they celebrate during a graduation ceremony for New York University at Yankee Stadium in New York, on May 18, 2022. President Joe Biden’s plan to provide millions of borrowers with up to $20,000 apiece in federal student-loan forgiveness has hit another roadblock. On Monday, Nov. 14, 2022 a federal appeals court panel agreed to a preliminary injunction halting the program as one of several court challenges unfolds.…
As fed resumes student loan collection, states try to catch borrowers before they sink
Over the past few months, Celina Damian’s phone has been ringing off the hook with one bewildered, anxious question after another: “What kind of loan is this?” “Am I in default?” “Will the government really take my wages?”
As feds resume student loan collections, states try to catch borrowers before they sink • Louisiana Illuminator
Graduates stand at the end of University of Louisiana at Lafayette commencement exercises May 16, 2025, at the Cajun Dome. (Greg LaRose/Louisiana Illuminator)Over the past few months, Celina Damian’s phone has been ringing off the hook with one bewildered, anxious question after another: “What kind of loan is this?” “Am I in default?” “Will the government really take my wages?” “Sometimes they just don’t know where to start,” said Damian, Califo…
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