In Texas, to halt wage garnishment for federal student loans, borrowers can try these options:
Negotiate repayment: Reach out to the U.S. Department of Education or the assigned collection agency to reset repayment terms.
Consolidate loans: Bundle defaulted loans into a Direct Consolidation Loan. This halts collections, moves your loan out of default, and opens up income-driven repayment paths.
Rehabilitate loans: Sign a loan rehabilitation deal. This requires nine consecutive payments based on your income. After the last payment, your loan exits default, and collections stop.
Dispute garnishment: If the U.S. Department of Education sends a wage garnishment notice, you might fight it. Grounds could be severe financial hardship or recent job loss.
Pay the debt: This might be tough, but it’s the quickest way to end default and halt wage garnishment.
For a limited time, federal student loan borrowers can take advantage of another option to get out of default: Fresh Start Program Student Loans. This program gets you out of default in a few weeks, sets you up with affordable monthly payments based on your income, and even clears the default from your credit report.
Bankruptcy is another option.
It can offer temporary relief from wage garnishment, especially if you’re swamped with other consumer debts. But this route has serious implications, so consult a legal expert.
To stop wage garnishment in Texas, consider paying the debt in a lump sum or negotiating a payment plan. Though Texas generally shields wages from garnishment for consumer debts, other collection methods may still apply.