The GAO says those with federal student loans in default may have Social Security benefits withheld
WASHINGTON, DC – Millions of seniors are struggling to pay off student loans. But, these seniors are not scholars; they are senior citizens, older Americans, many of whom have had their retirement plans disrupted as a result.
And, according to the Association of Mature American Citizens [AMAC], Social Security benefits can be garnished if they default on federal student loans.
In fact, says AMAC’s president, Dan Weber, a growing number of seniors are having their Social Security benefits withheld because they are defaulting on their federal student loans. He cites the U.S. Government Accountability Office [GAO], which has reported that “older borrowers (age 50 and older) who default on federal student loans and must repay that debt with a portion of their Social Security benefits often have held their loans for decades and had about 15 percent of their benefit payment withheld.”
Total outstanding student loan debt has reached “stratospheric proportions. It currently stands at more than $1.5 trillion– that’s trillion with a T. And, $86 billion dollars of that debt is owed by Americans over the age of 60,” according to Weber.
The GAO has made suggestions that could aid seniors whose Social Security benefits may be garnished. For example, if benefits are less than $9,000 a year [$750 a month] they cannot be garnished. But, it’s been quite a while since that $9,000 threshold was established and so the GAO suggests that it be increased and indexed for inflation.
Meanwhile, if your benefits are being garnished be aware that the Department of Education may be able to help you create a more-affordable repayment option. Get in touch with the DOE and ask for a suspension or a reduction. You’ll have to provide documentation for relief
More than 50% of seniors whose benefits are being withheld are receiving disability payments and may be able to receive a disability waiver. It can be a difficult process, but it also can be worth the effort. It’s been reported that as many as 33% of disability waiver applications are approved.
Finally, says Weber, there are agencies and organizations that can provide specific help in getting out from under Social Security offset withholding due to a student loan default. He suggests getting in touch with the National Consumer Law Center or The National Center on Law and Elder Rights.
The Association of Mature American Citizens [AMAC] [https://www.amac.us], with 2 million members, is a vibrant, vital senior advocacy organization that takes its marching orders from its members. We act and speak on their behalf, protecting their interests and offering a practical insight on how to best solve the problems they face today. Live long and make a difference by joining us today at https://amac.us/join-amac.