Millions of student loan borrowers are delinquent. Lawsuit blames the feds.

Bryant Willis
Thu, 15 Jan 2026 10:06:00 -0500

Atlanta Journal Constitution

By Jason Armesto

Jason Armesto is the higher education reporter for the AJC.

‘Do we really have that many deadbeat student loan borrowers?’ asks Wayne Johnson, the Macon resident and former Republican congressional candidate financing the lawsuit.

A record number of student loan borrowers, including many Georgians, are on the verge of potential financial ruin, and the U.S. Department of Education is to blame.

That’s according to a class-action lawsuit recently filed in Georgia, which alleges the department’s own incompetence and “willful negligence” has led to mass operational failures, with borrowers paying the price. Left unchecked, the department’s alleged misconduct will collectively cost borrowers $2 trillion in damages by April, according to the complaint.

Since a COVID-era pause on student loan payments ended in late 2024, many of the country’s 43 million borrowers — including about 1.7 million in Georgia — have struggled to return to payment. Five million are currently in default, with some estimating that figure will double this year. The ballooning number has gained attention after reports that the department will soon garnish wages for some defaulters.

But those headlines ignore a question that Wayne Johnson, who led the federal Student Loan Program during President Donald Trump’s first term, said too few are asking.

“Do we really have that many deadbeat student loan borrowers?” asked Johnson, the Macon resident and former Republican congressional candidate financing the lawsuit.

The answer, he said, is no. And the truth, according to the lawsuit, is that the federal government is pushing ahead with loan collections despite knowing it was unprepared to restart the repayment operation after a long hiatus.

Borrowers want to return to payment, said Johnson, but the department’s poor planning has made it impossible. Yet that hasn’t stopped it from reporting borrowers to credit bureaus as delinquent, decimating their credit scores in the process.