“It could not have happened at a worst time for millions of Americans,” said Aissa Canchola Bañez, director of Student Borrower Protection Center, a non -profit group that aims to reduce student debt. These borrowers, she added, “already find themselves navigating an economic uncertainty as incredible in recent months.”
It also underlines the fact that older borrowers tend to deal with the greatest difficulties in repaying their loans: almost 40% of federal borrowers over 65 years old were in default on their student loans, according to a 2017 report from the Consumer Financial Protection Bureau. “These are the elderly who are on fixed income,” she says.
When the borrowers are late, added Bañez, their credit ratings can take a hit, which makes more difficult the qualification of more credit and other loans for things like housing and other basic needs.
The Department of Education said in its opinion that, later this summer, it will start the salary garnish process – payments in terms of payment would automatically be deducted from borrowers’ pay checks.
