Current Events in April 2025

Key Points:

• Florida Attorney General James Uthmeier has filed a lawsuit against Snap, Inc., alleging violations of state laws designed to protect children from harmful online content.

• The suit claims Snapchat's addictive design features and lack of age safeguards expose minors to drug dealers, sexual predators, and explicit content.

• Florida's HB 3 law requires parental consent for users under 16 and prohibits addictive app features for young users, which the Attorney General says Snap has violated.

Florida Attorney General James Uthmeier has launched a legal battle against Snap, Inc., the parent company of the social media giant Snapchat, alleging that the company has violated state laws by knowingly endangering children through its platform.

At the heart of the lawsuit is Florida’s HB 3, a law passed in 2024 and signed by the governor, which aims to curb behavioral addiction among minors using social media. The statute targets five specific app features deemed “addictive,” of which Snapchat is accused of using four: infinite scrolling, push notifications, auto-play videos, and engagement tracking tools such as SnapStreaks.

“Snap is deceiving Florida parents about the dangers children face on the app,” said Uthmeier in a statement. “We take the safety and security of children very seriously, and as part of our mission to make Florida the best place to raise a family, we are holding social media platforms that harm children accountable.”

Alleged violations of child protection laws

HB 3 prohibits social media platforms from offering accounts to users known to be 13 years old or younger, and requires explicit parental consent for users aged 14 and 15. The attorney general’s office contends that Snap, Inc., is defying this mandate by promoting the app as safe for children as young as 13 without meeting the legal consent requirements.

The suit further asserts that Snapchat exposes minors to a range of inappropriate content, including profanity, nudity, drug and alcohol use, and sexually suggestive material. It also alleges that the app provides a conduit for dangerous individuals, including drug dealers and sexual predators, to reach underage users with relative ease.

Wider implications?

Snap, Inc. has previously acknowledged its responsibility under HB 3 in separate legal proceedings, yet according to the state, it continues to disregard the law. The complaint portrays this as an intentional act of deception directed at parents and guardians.

This case could have significant implications for how social media platforms operate in Florida and possibly beyond. If successful, it could pave the way for other states to enact or enforce similar regulations.

The attorney general’s office did not specify the penalties being sought, but emphasized that the legal action is part of a broader commitment to making Florida “the safest state in the nation to raise a family.”

Key takeaways

• Deceptive marketing exposed: YouTuber and self-proclaimed "scambaiter" "Ben Dover" investigates online ads falsely claiming to sell "handcrafted" leather bags by using buzzwords like "authentic" to imply quality.

• Fraud uncovered: Through reverse image searches and online sleuthing, Ben said he found that the women in the ads are AI-generated, customer reviews are fake, testimonials come from Fiverr actors, and the bags are mass-produced in China.

• Scambaiting caution: While the video is both informative and entertaining, viewers are warned that scambaiting should be left to experienced individuals to avoid personal risk when dealing with scammers.

Marketers learned long ago that consumers – especially certain segments of consumers – respond favorably to certain descriptive words. Words like “authentic” and “handcrafted.” These terms imply quality and value.

However, some unscrupulous marketers employ these buzzwords to sell consumers things that aren’t exactly high quality. A YouTube poster who uses the alias “Ben Dover” spends much of his time scrolling through the web looking for misleading and downright fraudulent pitches.

“Ben,” a self-described “scambaiter,” engages these marketers in a prolonged interaction until he can expose them. He recently posted the video below, describing how he saw numerous ads that had remarkable similarity.

‘When they’re gone, they’re gone’

The ads were all for “handcrafted leather bags,” made by a woman who was ending her decades-long career by liquidating her inventory at discount prices. Consumers were urged to buy quickly because “when they’re gone, they’re gone.”

Remarkably, “Ben” found other sites offering the same merchandise, but showing a different woman, with a different name, who made the bags. “Ben” used a software tool to discover the woman’s image was generated by AI.

“Wait, what, there’s no Grace,” Ben said in the video. “Who, then,  is making these high-quality, handcrafted leather bags?”

“Ben” went down that rabbit hole until he discovered the glowing reviews were fake and the video testimonials were by paid actors on Fiverr. Also, the products were anything but “handcrafted.” Spoiler alert: they were mass-produced in China.

Be sure to watch the video – it’s entertaining as well as informative. And one final note, it’s best to leave “scambaiting” to people like “Ben,” because it’s easy to make a mistake when engaging with a scammer.

Key takeaways

• Eli Lilly has filed lawsuits against four telehealth companies—Mochi Health, Fella Health, Willow Health, and Henry Meds—accusing them of deceptively marketing and selling compounded versions of its FDA-approved drugs, Mounjaro and Zepbound.

• Lilly alleges these companies are promoting untested and unapproved drugs while steering patients away from its branded medications, despite compounding rules requiring tailored solutions for individual patient needs.

• The legal action also questions the safety of the compounded drugs and challenges whether the defendants are violating FDA rules by mass-marketing rather than customizing medications, even though a drug shortage in 2022 had temporarily permitted compounding of Mounjaro.

Eli Lilly has filed lawsuits against four telehealth companies it says are selling compounded versions of Mounjaro, Lilly’s diabetes drug, and Zepbound, a drug for weight loss and control.

Lilly’s lawyers say the four sites –  Mochi Health, Fella Health, Willow Health and Henry Meds – are engaging in deceptive behavior as they market the compounded versions of Lilly’s popular medications.

The U.S. Food and Drug Administration allows compounding pharmacies to make versions of an approved drug if it is in short supply. Because of the enthusiastic consumer demand for GLP-1 weight loss drugs, Mounjaro was declared to be in short supply in 2022, allowing compounding pharmacies to make and sell a version.

‘Untested and unapproved’

The complaint alleges that the four telehealth sites are guiding patients away from Lilly’s versions of the two drugs and toward their own “untested, unapproved drugs.” According to CNBC, the four defendant companies have not commented on the litigation.

Lilly’s suit accuses the defendants of offering personalized options but are really mass-marketing different versions of Lilly’s drugs. 

Under compounding pharmacy rules, the pharmacies are allowed to make the drugs but must tailor medications to meet the unique needs of patients. This might involve:

• Changing the dosage or strength of a medication.

• Removing allergens or non-essential ingredients (like dyes or preservatives).

• Creating a different form (e.g., turning a pill into a liquid).

• Combining multiple medications into a single dosage.

These customized formulations are especially helpful for patients with allergies, difficulty swallowing pills, or specific dosage needs not met by mass-produced drugs.

In its suit, Eli Lilly also calls into question the safety of the compounded versions.

Key takeaways:

• Robert F. Kennedy Jr. calls sugar "poison" and vows sweeping food industry reform by 2026
• Claims "understanding" with food makers to remove petroleum-based dyes, though none have confirmed
• Critics warn his agency staff cuts may undermine enforcement and food safety oversight

Health and Human Services Secretary Robert F. Kennedy Jr. dramatically intensified his campaign against the processed food industry on Tuesday, proclaiming that “sugar is poison” and unveiling an ambitious plan to eliminate artificial dyes from many grocery products by 2026.

Speaking in the grand hall of the HHS building before an audience of supporters and agency leaders, Kennedy declared war on ultra-processed foods, accusing the industry of fueling a public health crisis through the marketing of sugar-laden and chemically enhanced products.

No industry sign-on 

While Kennedy claimed to have an “understanding” with major food manufacturers to remove petroleum-based food colorings, no companies publicly confirmed such an agreement. Notably, no food industry representatives were present at the press conference, the New York Times noted.

The only public pledge thus far comes from the International Dairy Foods Association, which has promised to eliminate artificial colors from milk, cheese, and yogurt served in federal school meal programs by the 2026 school year.

Consumer and public health groups were underwhelmed by the announcement. Dr. Peter Lurie, president of the Center for Science in the Public Interest (CSPI) called the press conference "disappointing" and noted that the agency issued "no rulemaking of any sort" to remove commonly used synthetic dyes from the food supply. 

"We are told that the administration has an unspecified 'understanding' with some unspecified fraction of the food industry to eliminate dyes," said Lurie. "We wish Kennedy and Makary well getting these unnecessary and harmful dyes out of the food supply and hope they succeed. ... But history tells us that relying on voluntary food industry compliance has all-too-often proven to be a fool’s errand."

Kennedy said food companies and some fast-food chains had reached out to the agency seeking “guidance” on reforming their products. “Four years from now, we are going to have most of these products off the market,” he said.

"Phase-out" of some dyes planned

On April 22, the day before Kennedy's news conference, the FDA announced plans to "phase out" from the food system six petroleum-based synthetic dyes: Blue 1, Blue 2, Green 3, Red 40, Yellow 5, and Yellow 6, by the end of 2026.  

Other, lesser-used dyes, namely Orange B and Citrus Red 2, will be phased out “in the coming weeks,” said FDA Commissioner Martin Makary.

The agency also said that it will request that the food and beverage industry remove Red 3 sooner than the previously announced compliance deadline of 2027 for foods.

However, the agency is not issuing a ban; instead, the FDA has asked food manufacturers to comply with the agency's request to remove these food dyes voluntarily. Because using synthetic food dyes has always been voluntary, there is no incentive from today's announcement for manufacturers to switch to natural food colors, CSPI's Lurie said.

Criticism over cuts 

While Kennedy’s crusade has drawn praise from health reform advocates, others warn that his own cuts to scientific research budgets and staff reductions at key federal agencies could sabotage enforcement. Critics argue that his slashing of personnel at the Food and Drug Administration and the National Institutes of Health has weakened the very institutions tasked with regulating the food industry.

Kevin Hall, the NIH’s leading nutrition scientist, recently resigned, citing censorship and diminished scientific rigor. Jim Jones, who headed the FDA’s food division, stepped down last month, warning that “indiscriminate” layoffs would render the agency ineffective.

Key takeaways:

• U.S. faces a housing shortage of up to 7 million homes, pushing prices to record highs
• Experts urge policy reforms to expand access to mortgages and safer loans for manufactured homes
  
• Outdated titling laws and financing gaps keep millions of affordable homes out of reach

As the United States grapples with a historic housing shortage of 4 to 7 million homes, experts say an overlooked solution is hiding in plain sight: manufactured housing. At a recent event hosted by The Pew Charitable Trusts, housing advocates, lenders, and policymakers emphasized the urgent need to modernize financing rules for these homes, which are often cheaper, energy-efficient, and just as durable as traditional houses.

Affordable yet out of reach

Modern manufactured homes, built under updated HUD construction codes, can cost up to two-thirds less per square foot than site-built homes. More than 22 million Americans currently live in them, yet many remain locked out of affordable financing due to outdated laws and systemic lending obstacles, Pew researchers say.

A key issue? Titling. In 49 states, manufactured homes are automatically titled as personal property, like a vehicle—rather than real estate. This classification often disqualifies buyers from mortgages, forcing them into higher-cost, riskier alternatives.

“Manufactured home financing is the major holdback,” said Dave Anderson, executive director of the National Manufactured Home Owners Association. “If the financing was improved, it would open the floodgate.”

The risks of alternative financing

According to Pew, only 44% of manufactured home buyers have a mortgage. The rest rely on home-only loans, which carry higher interest rates, shorter terms, and fewer protections.

Worse, a significant portion—particularly those unable to title their home as real estate—resort to contract financing arrangements like lease-purchase or land contracts. These deals often lack clear terms and legal protections, putting borrowers at elevated risk of eviction, equity loss, or fraud.

“There are so few safeguards,” said Daniel Rezai, a housing attorney at the Virginia Poverty Law Center. “Oftentimes the seller never even owned the home—they just evicted the previous tenant and sold it again under contract.”

Three key policy opportunities

Speakers at the Pew event identified three major reforms to unlock safer, more accessible financing for manufactured homebuyers:

1. Modernize Titling Laws: States can revise legal frameworks to make it easier for manufactured homes to be titled as real estate, enabling access to mortgages and refinancing options.

2. Revive FHA Title I Loan Program: The Federal Housing Administration should update its home-only loan program to mirror standard mortgage policies—such as underwriting automation and allowable fees—making it more attractive for lenders.

3. Enhance Protections for Contract Financing: Lawmakers at both the federal and state level should bolster consumer protections for borrowers using nontraditional financing arrangements.

A hidden opportunity in the housing crisis

Despite being safer and more affordable, home-only loans remain limited by the absence of a robust secondary market, leaving lending to private equity groups with fewer resources and higher pricing.

“We could offer homeownership to more Americans,” said Paula Reeves, president of the Affordable Housing Division at Land Home Financial Services. “It’s got to happen.”

With home prices soaring and millions priced out of the market, policymakers now face a clear opportunity: reforming manufactured home financing could not only bring relief to underserved buyers but also boost the national housing supply—quickly and affordably.

Key Takeaways:

• The FDA is launching a comprehensive plan to eliminate petroleum-based synthetic food dyes and replace them with natural alternatives.

• Two dyes, Citrus Red No. 2 and Orange B, will soon have their approvals revoked, while six others will be phased out by the end of next year.

• The initiative is part of the "Make America Healthy Again" campaign, with a strong focus on protecting children's health and restoring public trust in food safety.

The U.S. Department of Health and Human Services and the Food and Drug Administration have announced a plan to phase out all petroleum-based synthetic dyes in food products. The action is part of HHS Secretary Robert F. Kennedy Jr.’s Make America Healthy Again campaign.

The FDA said it will begin by establishing a national transition framework, setting clear standards and deadlines for food manufacturers to replace synthetic dyes with natural colorants.

Two dyes—Citrus Red No. 2 and Orange B—are first on the chopping block, with authorization revocations expected within months. Meanwhile, six additional synthetic dyes, including FD&C Red No. 40, FD&C Yellow Nos. 5 and 6, and FD&C Blue Nos. 1 and 2, are slated for removal from the food supply by the end of 2026

At the same time, the FDA is expediting the approval of four natural alternatives and reviewing several others, such as calcium phosphate, Galdieria extract blue, and butterfly pea flower extract, offering manufacturers a wider range of safe, natural coloring options.

The objective

Kennedy has long been a critic of synthetic food dyes, noting that they are banned in many other countries, including Canada.

 “These poisonous compounds offer no nutritional benefit and pose real, measurable dangers to our children’s health and development,” Kennedy said in a statement. “We’re restoring gold-standard science, applying common sense, and beginning to earn back the public’s trust.”

FDA Commissioner Dr. Marty Makary echoed these concerns, linking synthetic dyes to rising childhood health issues such as obesity, diabetes, depression, and ADHD. “Today, the FDA is asking food companies to substitute petrochemical dyes with natural ingredients for American children as they already do in Europe and Canada,” Makary said.

Key takeaways:

• Around two in five home sellers cut deals that lowered the total cost of buying a home in the first three months of 2025.
• Cancellations of pending home sales went up in March, showing how economic concerns are weighing on prospective homebuyers and challenging sellers. 
• Tariffs and economic uncertainty are presenting opportunities to homebuyers who are more comfortable with their finances.

Home sellers have been giving concessions at levels not seen for years, another sign that housing has shifted to a buyer's market.

Some 44% of home sellers in the first quarter of 2025 gave concessions, deals that lower the total cost of buying a home, which is just shy of the record 45% rate in 2023, according to a report from real-estate brokerage Redfin.

Concessions can include money towards repairs, homeowners association fees and closing costs, but don't include when the sale price is dropped even though that has been increasingly happening, too.

“Buyers used to ask for concessions to cover little things like repairs. Now they’re negotiating concessions so they can afford to buy a home,” Chaley McVay, a Redfin Premier real-estate agent in Portland, Oregon said in a statement. “A lot of sellers are offering money for mortgage-rate buydowns, and I recently had one seller cover seven months of HOA fees for the buyer.”

Some home prices have also dropped with concessions

Redfin said some 21.5% sold in the first quarter of 2025 had a final sale price below the asking price in addition to a concession, up from 18.5% a year earlier, while around 16% had a price cut and a concession, up from 13% a year earlier.

And nearly 10% had all three: A concession, a price cut and a final sale price below the original list price, up from 8% a year earlier, Redfin said.

Where are home sellers giving more concessions in 2025?

Concessions are far more common in parts of the country.

Seattle, Washington had the biggest share of home sales concessions in the first quarter of 2025, with 71%, up from 36% a year ago.

The other top five metros for concessions were Portland, Oregon (64%), Atlanta, Georgia (62%), San Diego, California (61%) and Denver, Colorado (59%).

Prospective homebuyers looking for concessions may also want to check out condos.

“It’s super common to see seller concessions for condos and new-construction townhomes, but less so for single-family homes — unless the single-family home has been sitting on the market for a while,” said Stephanie Kastner, a Redfin Premier real estate agent in Seattle, in a statement.

She said it is much more common for concessions to be offered with condos because of skyrocketing HOA fees, insurance and it is in the best interest of builders to keep sales prices high even if they will cut deals.

“Condos have become a tougher sell," Kastner said. "And builders are offering concessions because it’s in their best interest to keep sale prices high; they’re willing to pay buyers’ closing costs and maybe provide a free washer-dryer if it means they don’t have to drop the listing price.”

Concessions show signs of trouble in housing market

The jump in home sellers giving concessions follow's economic uncertainty, largely brought on by President Trump's tariffs, that is sending jitters through the housing market.

Tariffs are specifically hurting housing markets in a few ways, including sending mortgage rates seesawing and boosting construction costs.

Home listings are now at a five-year high and home sales slowed to their slowest pace in six years in March, Redfin said.

Home values also only increased 0.2% in March, a month of typically strong growth, and prospective homebuyers now have 19% more homes to choose from than a year ago, according to real-estate website Zillow, which also turned it home price forecast into negative territory, predicting that home values decline 1.9% in 2025.

And the equivalent of around 13% of homes in March saw their pending sales cancelled, which is the third highest March level in records dating back to 2017, Redfin said.

Key takeaways

• Public Health Alert Issued: The USDA's Food Safety and Inspection Service has issued a health alert for 16-oz. packages of pork carnitas sold at Aldi, potentially contaminated with metal fragments due to damaged processing equipment.

• Product Details and Risk: Affected products were produced on April 1–2, 2025, with "USE BY" dates of 06/30/2025 or 07/01/2025, and marked with "Est. 46049." While no injuries have been reported, FSIS urges consumers not to eat the product and to discard or return it.

• Consumer Guidance: Though the items are no longer sold in stores, they may still be in home freezers. Concerned consumers should contact a healthcare provider if necessary, and questions can be directed to Cargill’s hotline or the USDA’s Meat and Poultry Hotline.

The U.S. Food Safety and Inspection Service has issued a public health alert for consumers who may have purchased pork carnitas products that may be contaminated with foreign material, specifically pieces of metal. 

FSIS did not request a recall because this product is no longer available for sale in commerce. However, the agency is concerned that it may still be in consumers’ freezers.

The fully cooked pork carnitas products were produced from April 1-2, 2025. The following products are subject to the public health alert:

• 16-oz. sleeved tray packages containing "Pork Carnitas SEASONED & SEARED PORK WITH JUICES SLOW COOKED WITH CITRUS" with "USE BY" dates "06/30/2025" or "07/01/2025" printed on the side of the packaging.

• The products subject to the public health alert bear the establishment number "Est. 46049" inside the USDA mark of inspection. These items were shipped to Aldi supermarkets nationwide.

The problem was discovered when the establishment notified FSIS that during routine process checks that they found equipment damage that may have contaminated the carnitas products with pieces of metal.

What to do

There have been no confirmed reports of injury due to the consumption of these products. Anyone concerned about an injury should contact a healthcare provider.

Consumers who have purchased these products are urged not to consume them. These products should be thrown away or returned to the place of purchase.

Consumers can contact Cargill's Consumer Hotline at 1-844-419-1574.

Consumers with food safety questions can call the toll-free USDA Meat and Poultry Hotline at 888-MPHotline (888-674-6854) or send a question via email to MPHotline@usda.gov.

For consumers who need to report a problem with a meat, poultry, or egg product, the online Electronic Consumer Complaint Monitoring System can be accessed 24 hours a day at https://foodcomplaint.fsis.usda.gov/eCCF/.

Key takeaways

• State attorneys general argue that PBMs owning pharmacies creates conflicts of interest and inflates drug prices, urging Congress to prohibit PBMs and their affiliates from owning or operating pharmacies to restore fair competition.

• Critics claim PBMs manipulate the drug supply chain, prioritizing shareholder profits over patient care and disadvantaging independent pharmacies, despite being originally intended to lower drug costs.

• PBMs maintain they help lower prices, but the coalition of 39 attorneys general contends that legislative action is needed to prevent anti-competitive practices and improve patient access to affordable medications.

A coalition of state attorneys general are pressing Congress to prohibit Pharmacy Benefit Managers (PBMs) and their affiliates from owning or operating pharmacies, saying that would help reduce prescription drug costs.

This argument has been going on for years. A Pharmacy Benefit Manager – also known as a PBM – is a third-party administrator that manages prescription drug benefits on behalf of health insurers. As such, PBMs play a critical role in the healthcare system by influencing drug pricing, access, and reimbursement.

Critics have long argued that PBMs keep drug prices higher than they should be. The Pharmaceutical Care Management Association, an industry group representing PBMs, counters that its mission is just the opposite, to help patients get lower drug prices. It recently called on drug companies to lower prices.

But 39 state attorneys general argue it isn’t working out that way. In a letter to Congress, the state officials urge legislative action to “restore fair competition.”

“Pharmacy Benefit Managers were created to reduce drug costs, but they’ve instead abused their position to enrich themselves at the expense of patients,” said Missouri Attorney General Andrew Bailey. “This is legalized profiteering—PBMs are manipulating the system, crushing independent pharmacies, and denying Americans access to affordable, life-saving medications.”

Too much control?

The coalition claims the current structure of the pharmaceutical supply chain allows PBMs to control pricing, availability, and access at every level—manufacturing, distribution, and retail. The state officials charge “prescription decisions are being made in boardrooms that focus on shareholder profits rather than doctors’ offices that prioritize patient care.”

The attorneys general are urging Congress to pass legislation prohibiting PBMs—or their parent companies—from owning or operating pharmacies. That law, they say, would restore balance to the market, ensure patients have access to affordable care, and prevent anti-competitive behavior that favors affiliated pharmacies over independent ones.

Joining Missouri in signing the letter were the attorneys general from Alaska, American Samoa, Arizona, Arkansas, California, Delaware, District of Columbia, Hawaii, Illinois, Kentucky, Louisiana, Maine, Maryland, Massachusetts, Michigan, Minnesota, Mississippi, Nevada, New Hampshire, New Jersey, New Mexico, New York, North Carolina, North Dakota, Ohio, Oregon, Pennsylvania, Rhode Island, South Dakota, Tennessee, U.S. Virgin Islands, Utah, Vermont, Virginia, Washington, West Virginia, Wisconsin, and Wyoming.

Key takeaways

• Recall overview: Honda is recalling 152,800 Acura MDX vehicles from model years 2014 to 2020 due to a lighting defect caused by moisture entering the tailgate light assembly and wiring harness, potentially leading to interior and exterior light failures.

• Safety risk: The failure of essential lights—including taillights, license plate lights, and position lights—can reduce vehicle visibility and heighten the risk of accidents.

• Remedy and contact: Acura dealers will inspect and repair affected vehicles for free, with owner notifications starting by May 27, 2025. Owners can contact Acura or NHTSA for assistance.

Honda is recalling 152,800 2014-2020 Acura MDX vehicles. Moisture may enter the tailgate lid light assembly and wiring harness, which can cause the interior and exterior lights to fail, including the lid lights, position lights, license plate lights and taillights.

Vehicle lights that fail to illuminate can decrease visibility and increase the risk of a crash.

What to do

Dealers will inspect the wiring and install a fuse harness, replace the lid light, and repair the body dust sealer, as necessary, free of charge. Owner notification letters are expected to be mailed by May 27, 2025. 

Owners may contact Acura's customer service at 1-800-382-2238. Acura's number for this recall is FLI. Vehicles included in this recall that were previously repaired under NHTSA recall number 19V-256 will need to have the new remedy completed.

Owners may also contact the National Highway Traffic Safety Administration Vehicle Safety Hotline at 888-327-4236 (TTY 888-275-9171) or go to nhtsa.gov.

To determine if your vehicle is included in this recall, visit the NHTSA recall page and enter your license plate number or 17-digit VIN.

Key takeaways: 

• Collections on defaulted federal student loans will restart May 5 after five-year pause
• Borrowers in default risk wage garnishment, tax refund seizures, and Social Security offsets
• Officials urge borrowers to explore loan rehabilitation and consolidation options to avoid penalties

The U.S. Department of Education announced Monday that involuntary collections on defaulted federal student loans will resume next month, ending a pandemic-era freeze that began in 2020. The move will affect millions of Americans, with financial consequences ranging from tax refund seizures to garnishment of wages and Social Security benefits.

Defaulted borrowers face consequences

Starting May 5, the government will once again begin collecting on defaulted student loans through mechanisms such as tax refund offsets and Social Security garnishment. Wage garnishments are expected to resume later in the summer. The change marks the final stage in the Biden administration’s phased restart of federal student loan obligations, which resumed general repayments last year.

Approximately 5.3 million borrowers are currently in default, according to the Education Department. That number could climb as more borrowers fall into delinquency amid rising repayment struggles.

Scott Buchanan of the Student Loan Servicing Alliance said the announcement should be a wake-up call: “Borrowers should be working actively with their servicers and pay attention to our outreach to avoid the meaningful consequences of default.”

Understanding default vs. delinquency

A loan becomes delinquent when a payment is late by more than 90 days and defaults after around 270 days of missed payments. Borrowers in default are no longer eligible for income-driven repayment plans, deferment, or federal aid until they resolve their status.

Experts like Betsy Mayotte, founder of the Institute of Student Loan Advisors, stressed the financial toll of default in a Washington Post report: “It can have a really negative impact on your credit score and prevent you from accessing other financial aid in the future.”

How to avoid or escape default

Borrowers concerned about their status are urged to visit studentaid.gov or wait to be contacted by the Federal Student Aid office, which will reach out in the coming weeks.

Two key options to escape default include:

• Loan Consolidation: A quicker fix, though it can add collection costs and doesn’t erase the default mark from your credit.

• Loan Rehabilitation: Requires nine consecutive on-time payments, but once complete, it removes the default from your record—though prior delinquencies remain.

Older, low-income borrowers at risk

Mayotte warned that older borrowers and those living paycheck to paycheck may be hit hardest by resumed collections. “Student debt is not only a young person’s problem,” she said. “And the older that people get, the higher likelihood they have of defaulting.”

She and other advocates urge borrowers not to delay. “There’s a lot of anxiety and shame around default,” Mayotte noted. “But the first step in feeling better will be to reach out and start talking about resolving the default.”