When the US government started collecting student loan debts again, millions of Americans saw their credit scores drop a lot. After 90 days without payment, companies that manage student loans tell credit bureaus about late accounts, which hurts credit ratings as much as going bankrupt. This makes it harder or more expensive to get car loans, home loans, credit cards, and other financial services. The Federal Reserve Bank of New York reported that in the first three months of 2025, over 3 million people with student loans had their scores fall significantly. The US Department of Education stopped federal student loan payments in March 2020 because of the pandemic, and they started again in 2023 with an extra year of grace. However, the Trump administration began collecting outstanding student loans again in late 2024.