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Private student loan trying to garnish wages. Can they do that?

Addison, IL |

I have a private student loan that is now in collection. The collection agency contacted me to collect, but I offered to setup a payment arrangement. The amount that they were willing to accept is way too much money that I can afford to give. I offered 75 a month, they said that they could only do 280. How do I go about sending a payment that I can afford without getting my wages garnished? Can the agency actually garnish my wages for private loans. The creditor was decent enough to wait a few more weeks for me to come up with a way to pay before suing. I just don't have the money that they are asking for? I need help, I don't want them to take more.

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Attorney answers 4


Yes, they can, unfortunately. Student loan debt collectors can play hardball since it is nearly impossible for the debtor to discharge the debt in bankruptcy court... and the debt will generally not become uncollectible after a number of years like most debts. They are under no obligation to accept whatever amount you offer.

Under Illinois law (link provided below) a creditor is allowed to garnish up to 15% of your monthly disposable income (wages minus legally-required deductions). They may also garnish bank accounts.

The information provided here should not be taken as a substitute for legal advice from retained local counsel. Mr. Basmaji does not intend to create nor does he consent to a formation of an attorney-client relationship with anybody, including the question poster, just by virtue of posting information on this website. If you are in need of legal advice, you should consult and retain local legal counsel.

Gary D. Bollinger

Gary D. Bollinger


I follow the link and found nothing addressing student loans garnishments without an underlying judgment.


Like Pierre stated student loans don't go away. The only way one can discharge a student loan obligation through bankruptcy is by demonstrating undue hardship. What this means from a practical standpoint is that you can't pay the loan now nor will you be able to in the future due to some sort of disability impacting your present and future economic earning capacity.


Any creditor can garnish your wages if 1) state law permits garnishment and 2) the creditor obtains a court judgment against you. With student loans, the creditor may not need to obtain a court judgment against you to garnish your wages, again, depending on state laws.

I am posting a link to provide you with additional information about student loans which I hope will help you. Good luck!


Unless your state allows it, a collection agency that is collecting a PRIVATE student loan cannot garnish wages unless it gets a judgment against you.

Collectors who are collecting FEDERAL student loans can obtain a wage garnishment without a judgment, but there are still some hoops to jump through (a notification letter, opportunity for administrative hearing, etc).

We find that most collectors will lie about your legal rights with respect to student loans, so carefully document everything that occurs in the collection process and then sit down with a lawyer in your area who handles Fair Debt Collection Practices Act (FDCPA) cases.

With a private student loan, it really is like any other private debt (mortgage loan, credit card, medical, etc) except that bankruptcy is much more restricted. This is where federal and private student loans are similar.

So negotiate the best you can (or get a good lawyer in your area to help you) as the owner of the loan can sue if the statute of limitations has not expired. Federal student loans have no statute of limitation but this is not true of private student loans. Read your contract and see when it went into default. Often private student loan contracts define default pretty broadly which means the clock may start running sooner than you might expect on how long the collector has to sue you. Occasionally, the default is too long ago for the collector to sue, depending on which state's statute of limitation law applies.

Best wishes and I'll put some links below that might be of help you.

John G. Watts
Birmingham, Alabama

No representation is made that the quality of legal services to be performed is greater than the quality of legal services performed by other lawyers. I am only licensed in Alabama and no information is intended to be legal advice. Instead, it is simply general education information to help encourage to speak with a licensed lawyer in your state.