Knowing understand the consequences of not paying your student loan is key to protecting your credit score. Some students have a hard time making payments and default on their loans, setting in motion a whole series of events that will negatively impact their lives for years to come.
Instructions
1. Make payments as best you can. Stay in constant contact with your lender. Request extensions for circumstances out of your control. You may be able to extend your payments with little or no penalty.
2. Consider applying for determent or forbearance of your loans. Determent occurs when your lender allows you to postpone payment on your principal temporarily. Forbearance occurs when your lender postpones or reduces your payments, but the interest still accumulates.
3. Consider applying for a consolidation loan. This would allow you have lower interest rates and only one monthly payment to one lender.
4. Know the potential consequences of default. They include: Being turned into a collection agency, a lawsuit, your wages may be garnished, the federal government will withhold social security benefits from you and defaulting on your loans will go permanently on your credit record.
Tags: your lender, Consider applying, occurs when, occurs when your, when your