Key Points
- A record 31% of federal student loan borrowers with a payment due were 90+ days delinquent as of April 2025, the highest figure ever recorded.
- Delinquencies have surged since February 2025, with millions of borrowers now at risk of defaulting in the coming months.
- Credit scores of affected borrowers have dropped significantly, signaling financial strain even among those with previously strong credit profiles.
Federal student loan borrowers are falling behind at a rapid pace, with repayment resuming and collection activity beginning. As of April 2025, a staggering 31% of borrowers with a payment due were at least 90 days late, according to new data from TransUnion. That’s the highest level of delinquency ever recorded and nearly triple the rate from just before the pandemic.
The numbers suggest growing financial stress among student loan borrowers. In February 2025, only 20.5% of borrowers were in this 90+ day delinquent category. By March, that number had jumped to 30.6%, and it ticked slightly higher again in April.
While the growth of borrowers being delinquent may be slowing, the damage has already been done for many. And collection activity is just starting to ramp up. So, if these borrowers end up falling even farther behind and into default, they could face more consequences.
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Millions Of Student Loan Borrowers Face Default
Being 90 days past due is not the same as being in default, but the risk is real. Once a borrower hits 270 days past due, they’re classified as in default, and the federal government can initiate collection efforts. That includes wage garnishment and tax refund seizures.
TransUnion estimates that of the 5.8 million borrowers who were 90+ days delinquent in April, about 1.8 million are on track to default by July. Another one million could default in August, with up to two million more following in September.
Only 0.3% of federal student loan borrowers were officially in default as of April, but that figure is expected to balloon in the months ahead unless borrowers act quickly.
Credit Scores Are Dropping
The financial consequences go beyond loan status. Borrowers who fall 90 days behind are seeing their credit scores drop by an average of 60 points, according to TransUnion’s data based on the VantageScore 4.0 model. The impact is even more severe for those who previously had strong credit. We've seen borrowers report 100 points or more credit score drops.
More than 20% of newly delinquent borrowers had been in the "prime" or "super prime" credit risk tiers before missing payments. After falling behind, nearly all dropped at least one tier, with many shifting into subprime status.
Borrowers are encouraged to monitor their credit with free credit monitoring tools to make sure they know their scores.
What Can Student Loan Borrowers Do Right Now?
Borrowers at risk of default should contact their loan servicer as soon as possible. There are ways to stop delinquency and get out of default.
Federal programs like income-driven repayment (IDR) can help lower monthly payments based on income and family size. In some cases, borrowers may be eligible for $0 monthly payments.
Loan rehabilitation is another option for those already in default. This program allows borrowers to make a series of consecutive, affordable payments and restore their loans to good standing. But it can only be used once, and it’s important to act before more severe collection measures begin.
Looking Ahead
While it’s possible that delinquency levels could plateau, as April’s slight uptick suggests, the path forward is uncertain. The Department of Education’s collection efforts have resumed, but millions of borrowers remain behind on their payments.
If delinquency trends persist, the financial fallout could extend far beyond student loans. Falling credit scores may impact access to car loans, mortgages, and even employment opportunities in industries that rely on credit checks. Your student loans can even get you fired in some cases.
Whether the worst is behind u, or just beginning, may depend on how quickly struggling borrowers can access help and get back on track with their repayment plans.
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Editor: Colin Graves
Robert Farrington is the founder of The College Investor and is widely recognized as one of the nation’s leading voices on student loan debt and saving for college. He holds an MBA from UC San Diego Rady School of Management and has spent over 15 years researching, writing, and advising on student loans, 529 plans, financial aid programs, and saving and investing for young professionals.
Robert has been featured in the The New York Times, The Wall Street Journal, The Washington Post, NBC News, and Forbes, where he has been a regular personal finance contributor for over a decade. His work combines both professional expertise and personal experience – he successfully navigated his own student loan repayment journey and has helped thousands of readers do the same.
He is committed to making the intersection of personal finance and education transparent and accessible. You can learn more about Robert on the About Page or on his personal site RobertFarrington.com.