Nearly one in three federal student loan borrowers are at risk of defaulting on payments as early as July, as delinquency and default rates soar in the wake of pandemic-era repayment relief ending. About 5.8 million federal student loan borrowers were 90 days or more past due on their payments as of April 2025, representing the highest delinquency rate ever recorded. "With over 200 million credit-active consumers in the US, the 5.8 million affected borrowers make up only a small percentage," reported TransUnion. Borrowers fall into default once they are 270 days past due. Nearly two million borrowers could reach default status in July, making them subject to wage garnishment and other collection actions by the US Department of Education. Another one million are expected to default in August, followed by two million more in September. This sharp rise in delinquency comes less than two months after the education department resumed collections on defaulted federal loans.
