Federal Student Loan Defaults: DOE Enforcement Delays Temper Consumer Credit Risk

The U.S. federal government ended forbearance on student loan interest in late 2023, and in mid-2025 it announced the resumption of collections on defaulted student loans. Many viewed this as the official end of pandemic-era borrower protections and a potential source of meaningful headwinds for consumer credit. However, as KBRA noted in a previous report on this subject, these headwinds would only significantly affect securitized consumer performance if the new administration’s Department of Education (DOE) aggressively pursued collection efforts and did not follow through on its commitment to support borrowers. Since DOE collections resumed in May, the degree of enforcement and the implementation of borrower support measures have been the central factors determining any potential credit impact. We continue to believe that the resumption of…