Across the country, more and more student loans are ending up in default. To learn what the repercussions may be if you find yourself in this situation, read on.
For a great number of student loans, if the loan has not been repaid for 270 days, in the case of a monthly installment loan, the student loan will be in default. Likewise, for most student loans, if a student loan has not been repaid for 330 days, in the case of other types of installments, the loan will be in default. The government has many recourses against you if you do not make your student loan payments and the loan defaults. Some of these recourses include:
- The IRS can intercept any income tax refunds you have coming to you and withhold these monies until your student loan is paid in full. If this should happen to you, you may be able to challenge the offset.
- Your wages could be garnished by the government. The government can take a percentage, up to fifteen percent (15%) in some cases, of your wages in order to repay the loan. Again, it may be possible to challenge this garnishment.
- Federal benefit payments meant for you can also be used to repay your student loan. Social security income is a form of federal benefit payment. Limits apply pertaining to how much may be taken.
- Although it is possible, legal action is probably the least likely action to be taken. It is noteworthy that there is no statute of limitations regarding student loans and the filing of a law suit. In other words, the government can file as soon or as late as they would like – even many years after you have forgotten about the student loan debt.
If all of these sound like nothing you want to go through, then it might be time to visit the web site of Student Loan Borrower Assistance at www.studentloanborrowerassistance.org. Student Loan Borrower Assistance can help answer a large range of questions with regard to defaulted student loans. They can also help you to find a solution to your problem.
If you are afraid that you may default on a student loan or if you have already defaulted on a student loan, you can try to get some additional assistance. To begin with, you can call the Department of Education’s Ombudsman at (877) 557-2575 or go to the department’s web site at www.fsahelp.ed.gov. However, be advised that they will only be able to assist you if you have already tried to solve the issue yourself.
It is never a good thing to default on your student loan. In addition to several recourses to obtain payment of the student loan, your default could be reported to the three credit reporting agencies which will immediately drop your credit score. If the government should decide to use a collection agency to obtain payment of your defaulted student loan, you will end up paying additional collection costs. Don’t allow this to happen! Try to negotiate a repayment plan so you don’t affect your credit history adversely.
Lexington Law Erased of This Woman’s Bad Credit – For Good. See Documented Proof at www.lexingtonlawreviews.com.
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- Understanding Student Aid Application Through A Student Loan Guide
- My Student Loan is About to Go Into Default! Do I Need To Worry?
- Consolidate Private Student Loan – What You Should Know
- Student Loan Consolidation Companies And The Simple Loan Turn Around
- There Are Means To Stop A Student Loan Default From Happening To You
