Date: Wed, 18 Oct 2006 13:39:17 -0500
From: Sgt.Sausage@gmail.com
Newsgroups: misc.invest.financial-plan
Subject: Re: Student loan default
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HW "Skip" Weldon wrote:
> Retired person drawing state pension and social security.  They have
> large student loan.
>
> I seem to recall a court test recently whereby if defaulted, student
> loan folks could take up to 15% of Social Security benefits.  But
> recovery is capped at that amount and nothing can be taken from other
> resources (bank accounts, a pension, etc.).
>
> Not sure about this.  Does anyone know more about it?
>
>
> -HW "Skip" Weldon
>  Columbia, SC

The collection of defaulted government student loans from the SS
benefits is authorized in the "Debt Collection Improvement Act" -- I'm
not familiar enough with it to confirm or deny the 15% cap on the
collections. Google that Act for details. There was a federal case
"Lockhart v. US" that may or may not be relevant -- again, google for
details.