Orlando teacher hit with $1M bill after thinking she paid off student loans 20 years ago, report shows

CBS News says U.S. Department of Education took money from woman’s monthly paychecks

Money cash bills

ORLANDO, Fla. – A public school teacher in Orlando was shocked when she received a bill for $1 million – 20 years after she thought she paid off her student loans, according to an article by CBS News.

The woman, only identified by Michelle, told CBS News that the government took hundreds of dollars each month from her paychecks to pay for the student loans in a process called garnishment. The U.S. Department of Education can order wages to be garnished to force repayment on defaulted loans.

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According to the article, Michelle’s $800 monthly garnishment started in 2008 and when it ended, she thought her loans were paid in full, but later started receiving notices about money she borrowed through the Perkins Loan Program. After graduating in1997, Michelle applied for loan forgiveness through the Perkins program, and later satisfied the teaching service requirements to get it.

She received a letter from her alma mater in July saying her Perkins loan was past due and that she owed $955,000.02.

Michelle’s daughter posted the letter to Reddit and an internet stranger offered help. The subreddit superhero stranger stepped in and it was determined that the amount was a a mistake.

After getting the bill reduced from $955,000.02 to $8,000, which still wasn’t the right amount, they were able to get her balance corrected to $408, which Michelle has since paid in full, according to the article.

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About the Author:

Jacob joined ClickOrlando.com in 2022. He spent 19 years at the Orlando Sentinel, mostly as a photojournalist and video journalist, before joining Spectrum News 13 as a web editor and digital journalist in 2021.