Record High Student Loan Defaults Impact Millions of Borrowers
A significant increase in student loan defaults has been reported, with approximately 9.5 million federal student loan borrowers now in default. This surge follows the expiration of pandemic-era protections and a shift in policy under the Trump administration, which moved away from the student loan forgiveness options previously expanded during the Biden administration. The number of borrowers in default has risen from 5.3 million in June 2025, indicating that nearly one in five federal student loan borrowers is at least nine months behind on payments. The end of the COVID-era student loan payment pause and the simplification of repayment options under the Trump administration have contributed to this increase. Borrowers in default face severe consequences, including damaged credit, wage garnishment, and withheld tax refunds. 
