Default Crisis and Treasury Handover

9.5M defaults ($233B); 3.6M new defaults in two quarters; 30% were current before pause. Treasury now handling 9.2M defaults; IRS offsets continue; Social Security offset starts July 1. Wage garnishment paused again. Projection: 12.5M defaults by end of 2026. A GOP bill aims to codify the Treasury transfer, and a 10-bill package advancing in the House would make the downsizing permanent. Retirees and older borrowers, especially Parent PLUS borrowers on fixed incomes, face heightened risk of Social Security offsets if collections resume. New article warns of concrete harm to Social Security recipients from the July 1 changes. State-level data shows Illinois at 18% default rate, for-profit schools at 33% nonpayment.