Taking out a Federal Direct Student Loan will have an impact on your future credit and financial aid eligibility. Failure to make regularly scheduled payments on your student loan can lead to a defaulted loan.
Please make sure to contact the Direct Student Loan at www.direct.ed.gov if you have any difficulties in paying your loan. This includes economic hardship, unemployment, temporary disability, or returning to school at least half-time. The government will give you several options to temporary defer your loan payments.
Consequences of Default:
- You will not be eligible for further Federal Student Aid.
- You will lose your deferment options.
- Your loan may be turned over to a collection agency.
- Your credit rating will be damaged.
- Your wages can be garnished and your tax refund can be taken away.
- You may be subject to legal action by the federal government.
- Your total debt may be increased by collection fees, attorney fees, late fees, court cost and additional interest.
Coming soon ... a new default prevention program for students!