The consequences of defaulting on federal or private student loans can be severe. The U.S. Department of Education, in particular, possesses strong powers for collecting on defaulted federal student loans.

What Can Happen When Student Loans Go Into Default

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Tips for Avoiding Default

Already in Default?

If you are currently in default on your federal or private student loans, the first thing you should do is contact your lender or loan servicer to find out how to get your loans out of default, which is sometimes referred to as rehabilitation. You can rehabilitate defaulted federal student loans either by making a number of consecutive, full, voluntary monthly payments or by consolidating your federal loans and agreeing to repay the consolidation loan under an income-based repayment plan.

Your primary goal should be getting a monthly payment you can afford right now. When your finances improve, you can speed up your payments to save money on interest.