Tuesday, January 3, 2017

Garnishing Social Security Benefits

student loans
If you are one of the millions of Americans who has attended college in last couple decades, then there is a good chance you are in debt. The price of higher learning in the United States has gone, and is likely to continue to go, in one direction—up. College Board figures indicate that the average level of tuition and fees at a four-year public college rose by 87 percent (in 2014 dollars) between 2000 and 2013.

While the rising price of tuition should be in line with the amount of money graduates can expect to earn upon entering the workforce, the reality is far from the case. Meaning, there will continue to be a large percentage of people who will not be able to pay their student loans. As a result, parents often consign for their children’s student loans—at seemingly great risk.

In order to ensure that older Americans pay back what they owe, the Federal government has garnished the benefits of over a hundred-thousand people ages 50 and older in the past year, The Washington Post reports. The U.S. Government Accountability Office (GAO) found that more than half of them were receiving Social Security disability benefits, such as SSDI or SSI.

The government is garnishing money from people who are already living below, or on the edge of the poverty line, to pay what is owed for Federal student loans, according to the article. No more than 15 percent of one’s monthly Social Security benefits can be garnished, but it is a percentage that has never been adjusted in respect to the rising cost of living; this effectively makes impoverished people even poorer.

“We can’t be garnishing people’s Social Security in a way that puts them into poverty,” said Senator Claire McCaskill (Mo.). “We need to make sure that we have adjusted the ability of the government to recover those loan amounts in a way that is not spiraling people into poverty.” 

Data for the Social Security Administration (SSA) indicates that there are as many as 179,000 permanently disabled people in default on their student loans, according to the article. In response to what many consider to be predatory behavior, Massachusetts Senator Elizabeth Warren co-sponsored a bill last year that would prohibit the garnishing of SSA benefits for student loans (currently held-up in committee).

“Our government is shoving tens of thousands of seniors and people with disabilities into poverty through garnishment every year — and charging them $15 every month for the privilege — just so that the Department of Education can collect a little bit more interest and keep boosting the government’s student loan profits,” Warren said. “This is predatory and counterproductive.”

If you have questions about an SSA garnishment resulting from your or your child's student loan, please contact Driscoll Law Corporation.

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