Nearly 12 million federal student loan borrowers are now in delinquency or default, a level of non-payment never seen before in the student loan portfolio. After a three-and-a-half-year national payment pause, followed by an additional two years of collections being paused, the repayment landscape bears little resemblance to the one that existed before the pandemic.

The Department of Education’s latest figures (provided to New America) place more than one-quarter of the federal portfolio in serious trouble.

The sheer size of the group raises a central concern: how many of these borrowers know they are delinquent, and how many are unaware that the return of collections could affect their wages, tax refunds, or federal benefits as early as next spring?

How Many Student Loan Borrowers Are Behind On Payments?

The new data show a complicated picture of repayment struggles that vary widely across borrower groups. The largest segment (about 5.3 million borrowers) were already in default before the payment pause began in March 2020 and remains there today. These loans never transitioned back to good standing during the freeze and are now first in line for renewed collection actions. While the number seems large - it's pretty close to historical default rate levels.

Another 1.3 million borrowers had a prior default, managed to exit it either during or soon after the pause, and have now fallen behind again. Their return to delinquency is an early sign that many households never fully recovered from the financial disruptions of the pandemic.

A third group (roughly 3 million people) borrowed before the pause and had never defaulted at any point. They are now delinquent for the first time. For many, repayment resumed under higher living costs, limited savings, and incomes that may not have kept pace with inflation. Or they may not even know their loans transitioned back into repayment.

The final segment (about 2.3 million borrowers) took out their loans during the pause itself. Many of them only recently entered repayment. For this group, the transition into monthly payments has collided with a complicated servicing environment and they also may not realize that payments are required.

Together, these categories create a population of nearly 12 million borrowers facing potential default.

What Delinquency And Default Mean

A borrower becomes delinquent after missing a payment, and federal loans typically enter default after about nine months of non-payment. But in practical terms, many borrowers do not feel the impact of delinquency right away. Notices may be missed, unfamiliar loan servicers may be involved, and for newer borrowers repayment can be confusing.

The real impact arrives when delinquency becomes long-term. Once a loan is in default, the federal government can require employers to withhold a portion of a borrower’s wages. Tax refunds (including refundable refunds like the Earned Income Tax Credit) can be seized. Federal payments such as Social Security benefits can also be garnished to recover unpaid debt. These actions were frozen during the pandemic but have restarted, and borrowers will start to feel this very soon.

That timeline matters. Borrowers who are currently delinquent could enter default in the coming months, meaning the first enforcement actions may hit during the next tax-filing season.

Borrowers May Not Know They're At Risk

Based on what we saw with the initial credit reporting drops, millions of borrowers may not realize they are behind. Servicer-to-servicer transfers, borrowers moving and changing contact information, and years of paused communication have left many borrowers unsure of where to check their status.

There are also borrowers who are simply confused about what's changing with student loans and repayment plans. Between the SAVE plan ending, the changes with the One Big Beautiful Bill coming, and little servicer communication, confusion leads to inaction.

For borrowers who previously exited default, the return to delinquency may come as an unwelcome surprise. Many may have taken advantage of the Fresh Start program or similar, only to find themselves back in trouble.

What Student Loan Borrowers Need To Do Now

If you have federal student loans (or if you have family members with loans) here's what you can do right now.

Check your federal loan account through StudentAid.gov or your servicer’s website and confirm whether any payments are past due. Update your contact information, since many delinquent borrowers miss notices because an address or email changed during the pandemic.

If you are already behind, contact your servicer and ask about repayment options. Income-driven repayment can lower monthly payments, and consolidation or rehabilitation may help borrowers already in default. Servicers can also explain whether a loan is at risk of being transferred to collections.

For families, it may help to speak with students or recent graduates who borrowed during the pause. Many may not realize they are already expected to make payments.

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