2026 is set to bring major changes for the millions of Americans with student loans — including nearly 4 million Texans.  

The Biden-era relief is over, and the Trump administration has threatened to take money from the paychecks of borrowers who are far behind on loan payments. The Education Department announced Friday it would temporarily pause that process, known as wage garnishment. 

Previously the department warned that borrowers in default would begin receiving notices of involuntary collections of 15% of their paychecks. A loan is considered in default if a borrower hasn’t made payments in at least 270 days.

Wage garnishment was paused “to give borrowers more options to repay their loans,” states the department’s announcement issued Jan. 16. The department also promised to make significant improvements to the student loan system. 

Advocates expressed relief after hearing the latest pause on garnishment. 

“Wage garnishment for borrowers in default is a cruel tactic that deepens the cracks in an already broken student loan system while expecting borrowers to hold up their end perfectly,”said Kristin McGuire, president and CEO of the nonprofit Young Invincibles, in a statement. “Forcing collections on borrowers who are already experiencing financial hardship pushes them even further from financial stability and upward mobility.”

In Texas, the nearly 4 million individuals with federal student loans hold a total debt of $132 billion, according to the Education Data Initiative. 

The One Big Beautiful Bill Act set new limits on how much students may borrow, and called for a restructuring of existing repayment plans, essentially phasing out current income-driven repayment options.

Following a court settlement, the Education Department announced last month it would no longer enroll borrowers in the SAVE Plan — a Biden-era relief program. The Institute for College Access and Success warned this would result in higher monthly payments for the 7 million borrowers currently enrolled in the plan. 

These changes added to the confusion of what options are available for those seeking to resume payments to avoid garnishment. Here’s what we know so far about the ongoing changes and the looming repayment deadline:

  • On July 9, 2025, the Department of Education announced that loans that had qualified for the Biden-era SAVE Plan would again begin accruing interest on Aug. 1, 2025.
  • Borrowers are asked to contact their loan servicer or check their loan accounts for information on repayment plan options.
  • The education department stopped allowing borrowers to apply for the SAVE Plan in early 2025, but those who had qualified for it were placed on forbearance plans until new repayment plans are finalized — between now and July 1, 2028.
  • Only borrowers with loans that predate July 1, 2026 are expected to have access to income-based repayment plans. Those who take out loans after this date will be placed under a standard repayment plan based on their loan amount. 
  • Borrowers with loans that predate July 1, 2014, are expected to have access to new repayment options by July 1, 2028. 
  • Borrowers who are experiencing economic hardship, are encouraged to update their earnings to have their payments recalculated. 
  • Federal officials are urging borrowers, especially those who cannot prove financial hardship that prevents them from making payments, to use the Loan Simulator to estimate what their repayment options will be or seek a better plan. This tool was updated in December 2025, according to the Federal Student Aid office. 
  • Parent PLUS borrowers with existing loans must consolidate their loans into a Direct Consolidation Loan before July 1, to be able to apply for income-based repayment options. 
  • Those who qualify for Public Service Loan Forgiveness and were enrolled in the SAVE Plan are asked to apply to switch to an income driven repayment plan to start making payments that qualify for a forgiveness option. 

For more specific questions on current loans or repayment plan eligibility, borrowers are asked to call their loan servicer. You can also visit the student borrower Q&A page for other information and updates.

The San Antonio Report partners with Open Campus on higher education coverage.