Can my wages be garnished by a third party administrator if I have a federal student loan that is in default?

UPDATED: Jan 9, 2012

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Can my wages be garnished by a third party administrator if I have a federal student loan that is in default?

Asked on January 9, 2012 under Bankruptcy Law, South Carolina


FreeAdvice Contributing Attorney / FreeAdvice Contributing Attorney

Answered 11 years ago | Contributor

If you have a student loan that is in default, before any wages of the borrower can be garnished by way of a garnishment order issued by the court clerk, there first must be an underlying judgment against the borrower for a certain dollar amount. Just because the borrower has fallen behind in payment does not in and of itself allow for the issuance of a wage garnishment order.

Meaning, the statutes in all states in this country first require that a lawsuit be filed where there is a resulting judgment against any person. In your situation you make no reference to a judgment against you. If there is no judgment against you, I fail to see how a wage garnishment can be validly issued as to your wages via your employer.

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