I know people who've defaulted on student loans, I'm not making anything up, you are assuming a lot.

The one thing I did not know was that a court case isn't needed for fed loans to garnish wages

but what I do know is none of the people I know ( in mid 30s-40s, college was 10 years ago), who have stopped paying, have not had consequences that prevented them from getting credit or housing or other loans, nor does wage garnishment just automatically happen and is actually pretty easy to avoid. This isn't just due to the pause on it either, they stopped paying long before covid hit.