Many people take out student loans to help pay for college, graduate school, professional school, and the like. After all, with college costs skyrocketing, people need a way to pay for their education. What most people do not understand is that you MUST pay back student loans. Student loan debt is generally not discharged in bankruptcy. Furthermore, the government has now authorized some debt sevicers to administratively garnish your wages.
What does that mean? Basically, if you are a student loan borrower and you stop making payments, the government does NOT have to sue you to collect the money. They can send a wage garnishment notice to your employer and your wages will automatically be garnished.
You can thank those people who chose not to pay back student loans for this. Congress passed this law to help keep the default rate on student loans in check. The rate was rising and there was little that could be done. Now, if you get behind, your wages will be garnished, up to 15% of your income.
You can find all of this in Public Law 102-164 and 20 USC 1095a.
Conclusion: Make sure you pay your student loans timely!